Still not sure if VAT on train tickets in the UK applies to your travel costs? You’re not alone. Many small businesses and commuters often ask, “Can I claim VAT on travel expenses like train fares?” The answer depends on whether the service is zero-rated or VAT-exempt.
This guide breaks it all down and explains exactly what VAT rules apply to rail travel in 2025, what you can (and can’t) reclaim, and how UK VAT law treats other forms of transport like buses, taxis, and Uber.
Are Train Tickets Subject to VAT in the UK?
In the UK, train tickets are zero-rated for VAT, meaning you won’t see VAT added to the fare. This is part of the train fare VAT exemption for 2025, aimed at keeping public transport affordable. But it’s easy to confuse this with VAT-exempt services, which don’t allow input VAT recovery.
Zero-Rating vs VAT Exemption: What’s the Difference?
- Zero-Rated (0%): No VAT charged to customers; VAT on related business expenses is reclaimable.
- VAT Exempt: No VAT charged to customers, but VAT on expenses cannot be reclaimed.
Train tickets fall into the zero-rated category—a subtle yet powerful benefit for businesses.
Train Fare Increases Without VAT
According to the Rail Fares Index 2024 (ORR), regulated UK rail fares rose by 4.9% in 2024 — the highest hike since 2011. Even though VAT is not applied, the rising cost of train travel highlights the importance of accurate expense classification in your VAT return.
Can You Claim VAT on Business Travel Expenses?
If you’re managing business travel expenses, knowing what you can and can’t claim VAT on is essential for accurate bookkeeping. Here’s a simple breakdown:
- Train Tickets (UK): Zero-rated for VAT, so there’s no VAT to reclaim.
- Taxi Fares: You can claim VAT only if the driver or company is VAT-registered and provides a valid VAT receipt.
- Fuel Costs: VAT is claimable on petrol and diesel used for business purposes; keep a mileage log as evidence.
- Car Hire/Leasing: You can usually reclaim 50% of the VAT for mixed use, or 100% if the car is used solely for business.
These small distinctions can make a big difference when filing your VAT return.
VAT Refund Checklist for Business Travel
To claim VAT on travel expenses:
- Be VAT-registered
- Have valid VAT invoices
- Keep accurate records
- File your VAT returns on time
- Only claim on VAT-inclusive expenses
Note: You can’t reclaim VAT on zero-rated items like train or bus tickets. But you can claim it on VAT-inclusive travel like taxis, car rentals, or international journeys (if VAT is charged and properly invoiced).
VAT on Public Transportation Modes in the UK
This table shows which UK transport services are zero-rated and which ones may include reclaimable VAT, crucial for accurate VAT on train tickets UK reporting.
| Transport Mode | VAT Charged? | Rate | Notes |
|---|---|---|---|
| Train Tickets (UK Domestic) | No | 0% | Zero-rated for all classes |
| Bus Services | No | 0% | Includes local and intercity buses |
| TFL (Tube, DLR, Overground) | No | 0% | All TFL journeys VAT-free |
| Uber Rides | Sometimes | 20% | Only if the driver is VAT-registered |
| Taxi Services | Sometimes | 20% | Larger fleets like Addison Lee charge VAT |
| Ferry (over 10 passengers) | No | 0% | Zero-rated unless linked with entertainment |
| Flights (Domestic) | No VAT | APD only | Charged Air Passenger Duty instead |
Exceptions Where VAT Does Apply
While most UK train tickets are zero-rated, there are specific situations where VAT may be charged:
- Luxury rail experiences – including scenic or chartered tourist trains
- International train routes – such as Eurostar journeys beyond the UK
“While traveling by train from the EU, I had to claim my VAT refund during a connection—getting the form stamped at my last EU stop before exiting to the UK.” — Reddit user on r/Brussels
- Meals or add-on services during the journey (e.g., onboard dining or upgrades)
- Tickets bundled with entertainment or admission, like museum shuttles, event trains, or theme park rides
Conclusion
Knowing which travel expenses are zero-rated and which allow VAT recovery is key for any business. If you’re unsure about how VAT on train tickets in the UK works or whether your costs are claimable, refer back to this guide.
Whether you’re a finance manager or a freelancer, understanding VAT rules for public transport helps reduce errors and boost reclaim accuracy.
Frequently Asked Questions
You can’t reclaim VAT on UK train tickets, since they are zero-rated travel services. However, you can claim VAT on other travel expenses like taxi fares, fuel, and car hire, if VAT is charged and you have a valid invoice.
Zero-rated services (like UK train fares) don’t charge VAT, but allow businesses to reclaim VAT on related expenses. VAT-exempt services, on the other hand, also don’t charge VAT, but you cannot reclaim any VAT associated with them.
Yes, but only if the taxi driver or Uber operator is VAT-registered and you receive a proper VAT receipt. This is one of the most common business travel VAT claims in the UK. Just make sure the receipt lists the VAT amount separately.
No, both buses and Transport for London (TfL) services like the Tube, DLR, and Overground are zero-rated for VAT, meaning no VAT is charged and none can be reclaimed.