TAXIS AND PHV ON THE TAX RADAR: How HMRC are now able to track drivers through fresh digital platform data rules
- Perry Richardson
- 6 days ago
- 2 min read
Self-employed taxi and private hire vehicle (PHV) drivers working through digital platforms are having their earnings reported directly to HMRC under new rules aimed at improving tax transparency in the gig economy.
From 1 January 2024, online platforms such as Uber, Bolt, Ola, and others operating in the UK have been required to collect and report detailed income data about individuals who earn through their services. The changes are part of the Government’s implementation of the OECD Model Reporting Rules for Digital Platforms, designed to standardise how authorities across different countries monitor income generated via digital work.
These rules apply to platforms that facilitate the provision of personal services, including passenger transport. The goal is to ensure that income earned through such platforms is being accurately declared and taxed. This does directly impact self-employed drivers who rely on digital bookings for their livelihood.
At the start of this year, operators submitted the first report to HMRC detailing the revenue earned by each driver.
Platforms are now expected to collect personal and financial information from drivers, including name, address, national insurance number, and taxpayer identification. They then need to submit data on total income received by each driver, as well as commissions or fees deducted by the platform itself.
This information must be submitted to HMRC annually. In turn, HMRC will use the data to identify discrepancies in self-assessment tax returns and pursue unpaid taxes where necessary. Digital platforms will also be required to issue annual income statements to drivers, detailing earnings in a format similar to the P60 provided to employees.
While HMRC has said the changes are aimed at levelling the playing field and improving compliance, the move has increased administrative pressure on both platforms and drivers. Operators must ensure their systems are capable of capturing and reporting the required information in line with the new legal requirements. Many platforms already provide income summaries, but under the new rules, these will become a statutory obligation and must follow strict formatting and delivery standards.
For drivers, the reporting will leave little margin for error in tax returns. Any inconsistencies between declared income and the platform data submitted to HMRC could result in further scrutiny or penalties.
The reporting rules are also expected to impact drivers working across multiple platforms. Each platform will report income separately, and HMRC will be able to consolidate data from various sources to assess total annual earnings. This will make accurate record-keeping and timely self-assessment submissions more important than ever.
The rules follow broader global efforts to bring tax reporting in the gig economy closer in line with that of conventional employment. Similar frameworks have already been adopted in countries including France, Denmark, and Canada. The UK rules are being designed to allow cross-border cooperation and information sharing between tax authorities, which could impact drivers who work in multiple countries.
