What are the fines and penalties taxi and ride-hail apps face for non-compliant drivers failing to submit HMRC tax details?
Ride-hailing platforms such as Uber, Bolt, FREENOW, and Gett could face significant financial penalties if large numbers of drivers fail to comply with new HMRC reporting rules.
The latest regulations, which came into effect on 1 January 2024, require digital platforms to collect and submit key tax details for all drivers operating through their services.
With the first reporting deadline now passed on 31 January 2025, the financial consequences for non-compliance are mounting. HMRC has set strict penalties for any platform failing to meet its obligations, with fines that could quickly add up to thousands of pounds.
Severe Penalties for Non-Compliance
HMRC has outlined three key penalties for reporting platform operators (RPOs) that fail to comply:
A fine of up to £1,000 for failing to register as a reporting platform.
An initial penalty of up to £5,000, with a continuing fine of up to £600 per day for missing the reporting deadline.
A penalty of up to £100 per inaccurate, incomplete, or unverified driver record.
For platforms managing thousands of drivers, even a small percentage of non-compliant accounts could lead to substantial fines. If a ride-hailing operator submits 1,000 incomplete or incorrect driver records, it could face a penalty of up to £100,000. If reporting failures persist beyond the deadline, the additional daily fines could drive costs even higher.
Financial and Operational Risks for Platforms
The financial risk is particularly high for large ride-hailing operators, which rely on a vast network of self-employed drivers. If platforms fail to ensure that all drivers have provided valid National Insurance details, the penalties could accumulate rapidly, putting pressure on their compliance teams.
Beyond fines, non-compliance could also lead to operational disruptions. Platforms that continue to allow drivers without verified tax details to operate risk further action from HMRC. To avoid this, many operators, including FREENOW, have already started blocking drivers who have not provided the required information.
In a statement, FREENOW confirmed that a small number of drivers have been restricted from using the platform until they submit their National Insurance details. The company stressed that accounts would be reactivated immediately upon compliance, following HMRC guidance.
With HMRC enforcement tightening, digital operators have taken a firmer stance in past few months. Many increased communication efforts, sending multiple email and SMS reminders to drivers. However, some of those who failed to comply faced restrictions or removal from the platform.
For ride-hailing companies, ensuring compliance is now a financial necessity. The combination of penalties for late reporting, inaccurate records, and daily fines for continued failures means that any operator that fails to meet its obligations could be looking at six-figure penalties if a significant number of drivers remain non-compliant.
