The UK Supreme Court has refused Bolt Services UK Limited permission to appeal against a landmark VAT ruling, bringing an end to its legal challenge over the use of the Tour Operators’ Margin Scheme (TOMS).

The decision, issued on 29 September 2026, means that the Court of Appeal's ruling in favour of HMRC on 12 June 2026 remains in place.

WHAT WAS THE DISPUTE?

Bolt had argued that its app-based private hire services should qualify for TOMS, a VAT scheme normally associated with travel agents and tour operators.

Under TOMS, operators could account for VAT on their margin – the difference between what the passenger pays and what the driver receives – rather than on the full fare.

HMRC argued that ordinary on-demand private hire journeys should not qualify for the scheme.

Although Bolt initially won its case at the First-tier Tribunal and Upper Tribunal, the Court of Appeal overturned those decisions in June.

Bolt subsequently sought permission to take the case to the Supreme Court.

SUPREME COURT SAYS NO

On 29 September, three Supreme Court justices refused permission to appeal, concluding that the application did not raise an arguable point of law of general public importance which the court ought to hear at this time.

HUGE SUMS AT STAKE

During the Court of Appeal proceedings, it was revealed that Bolt's case involved an estimated £190 million, while other cases involving sums well in excess of £1 billion were awaiting the outcome.

WHAT DOES THIS MEAN FOR THE PRIVATE HIRE TRADE?

The decision reinforces HMRC's position that operators supplying ordinary on-demand private hire journeys as principal cannot use TOMS to account for VAT solely on their margins.

Importantly, the Government had already changed the law from 2 January 2026, excluding most taxi and private hire journeys from TOMS.

The Supreme Court's refusal is particularly significant for disputes concerning VAT treatment before that legislative change.

The ruling does not mean that every private hire operator must charge VAT on the full fare. The VAT position still depends on whether the operator acts as principal or as a disclosed agent, together with the normal VAT registration rules.

This is a major conclusion to a long-running legal battle which has implications for operators, HMRC and the wider private hire industry.

Sue Rathmell, VAT partner at MHA, comments on the Supreme Court's refusal to hear Bolt's appeal: "This brings to an end a long-running dispute over whether taxi and private hire operators such as Bolt and Uber could use the Tour Operators' Margin Scheme (TOMS) to reduce the amount of VAT they paid on journeys.

"Under TOMS, VAT is only payable on the operator's margin rather than the full value of the fare. HMRC has argued for several years that the scheme was never intended to apply to ride-hailing businesses, while operators maintained that they were entitled to use it under the existing legislation.

"The Government had already moved to close the issue for the future by changing the law from 2 January 2026, meaning VAT must be accounted for on the full value of taxi and private hire journeys rather than just the margin. However, these cases were about the historic position and the potentially enormous sums at stake.

"The Supreme Court's decision to refuse Bolt permission to appeal means HMRC's victory at the Court of Appeal now stands. Uber's case was effectively waiting in the wings behind Bolt, so this decision is likely to bring the wider litigation to a close.

"The amounts involved are significant. It has been estimated that the use of TOMS was worth at least £290 million to Bolt alone, with an even greater value for Uber and more than £1 billion across the industry as a whole. The decision therefore represents a major win for HMRC and provides long-awaited certainty for the sector after years of litigation and legislative change."

Source: UK Supreme Court – Case UKSC/2026/0096

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