VAT on Train & Plane Tickets

Train and plane travel can be very expensive, but does the cost of your ticket include 20% VAT?

VAT on train travel

Travel on a train in the UK is "passenger transport", which is zero-rated (which means no VAT is charged) if the train has at least 10 seats, including those for the driver and crew.

VAT at the standard rate (20%) is charged on travel on a train to, from or within a fairground, theme park, water park, safari park, zoo, museum, stately home, and other places of entertainment or historical, scientific or cultural interest when the travel is linked to admission to the premises, even if a separate charge is made for the train fare.

VAT on plane travel

Like train travel, plane travel in the UK is zero-rated as passenger transport if the plane has 10 seats or more, including those for the pilot and crew.

Plane tickets for scheduled flights, i.e. flights that run according to a published timetable, are zero-rated regardless of how many passengers can be carried.

Plane travel that takes place both inside and outside the UK is zero-rated to the extent the transport takes place in the UK even if the plane does not have 10 seats or more.

Exceptions

Certain types of flights are not zero-rated and VAT is charged at the standard rate. These include:

• ‘Fear of flying’ flights
• Airship rides
• Pleasure flights where the aircraft departs from and returns to the same airport without an advertised landing and disembarkation of passengers at another airport.
• Hot air balloon rides

Zero-rated passenger transport services

The following are all treated as zero-rated passenger transport, meaning no VAT is charged:

• bus and coach transport
• pleasure cruises
• cliff lifts
• horse-drawn buses
• mystery coach or boat trips
• sightseeing tours
• the transport element of park and ride schemes designed to reduce traffic congestion in city centres.
• the transport of parachutists or divers as long as it’s only transportation that’s provided.

Transport services to places of interest which are free to access are zero-rated. For example, transport to national parks, seaside resorts, historic towns and villages, canals and lakes.

Passenger transport services that are standard-rated for VAT

Some passenger transport services are always subject to VAT. For example:

• Taxis and hire cars, unless the vehicle has 10 or more seats.
• Novelty rides or fairground attractions, such as roller coasters, ghost trains, roundabouts, and miniature/model railways.
• Donkey rides.
• Monorails, cable cars and boats at visitor attractions where the transport is provided by the operation of the attraction or someone connected to the operator.
• Transport between a car park and airport/cruise terminal where the transport is provided by the car park operator or someone connected to the operator.

Reduced rated passenger transport services

VAT at the reduced rate (5%) is charged on passenger transport in a cable-suspended vehicle with less than 10 seats.

Examples of cable-suspended vehicles include a chair, bar or gondola which is suspended from a cable.

Transport on a cable-suspended system which transports passengers from one point to another is reduced rated, and covers the following:

• cable cars
• ski-lifts
• chairlifts