HMRC has won its Court of Appeal appeal against Bolt Services UK Limited in a judgment handed down on 12 June 2026, with Lady Justice Falk ruling that Bolt’s on-demand minicab services do not fall within the Tour Operators Margin Scheme and that Bolt must charge VAT on its entire fare rather than only its margin — a decision with direct financial implications estimated at £190 million for Bolt and over £1 billion for related cases that were awaiting its outcome.
The judgment, agreed by Lord Justice Arnold and Sir Colin Birss, Chancellor of the High Court, reversed decisions of both the First-tier Tribunal and the Upper Tribunal Tax and Chancery Chamber, where Mr Justice Meade and Judge Ashley Greenbank had found that Bolt’s supplies were sufficiently comparable to those of travel agents and tour operators to engage the Tour Operators Margin Scheme under section 53 of the Value Added Tax Act 1994 and the Tour Operators Order 1987. The Court of Appeal rejected that analysis entirely.
Bolt, which operates as a licensed private hire vehicle operator in the UK with London as its largest market and provided 35.9 million PHV journeys between August 2022 and May 2023, had argued that its on-demand ride-hailing services fell within the Scheme — which permits VAT to be charged only on the operator’s margin rather than the full fare — because it provided transport as principal using services bought from third-party drivers. Both lower tribunals accepted a broad high-level approach to comparability with travel agent and tour operator services.
Lady Justice Falk rejected this approach. The Court held that the Tour Operators Margin Scheme, as an exception to normal VAT rules, must be applied only to the extent necessary to achieve its objective and that Bolt’s concession that it is not a travel agent or tour operator within the ordinary meaning of those terms was determinative.
The comparability test requires services to be identical or at least comparable to those provided by travel agents and tour operators — and the First-tier Tribunal had itself found it was not satisfied that travel agents and tour operators commonly provided on-demand rides from point A to point B similar to those provided by Bolt. That finding should have led to Bolt’s challenge failing. Eleni Mitrophanous KC and Charlotte Brown of HMRC Legal Group appeared for HMRC. Valentina Sloane KC and Jenn Lawrence, instructed by Deloitte LLP, appeared for Bolt.
For VAT practitioners and tax lawyers advising digital platform businesses the ruling establishes a clear boundary on the Tour Operators Margin Scheme comparability test.
The Court’s reasoning — that merely being a transport operator buying in services from third parties is insufficient to make supplies comparable to those of travel agents or tour operators — has immediate implications for other gig economy and platform businesses that had structured their VAT position on the basis of the lower tribunal decisions.
Law firms advising ride-hailing platforms, delivery services and digital marketplace operators across Herbert Smith Freehills, Ashurst and Pinsent Masons‘ tax practices will be reviewing client VAT structures against this judgment through the remainder of 2026.