When buying a train ticket in the UK, you may notice that the price doesn’t show a breakdown of VAT (Value Added Tax). This often raises the question: is VAT charged on train fares at all? 

The answer is that most passenger transport services in the UK, including train travel, are zero-rated for VAT. But understanding why, and how this fits into broader VAT rules, requires a closer look at how the UK treats passenger transport under its tax system.

What is VAT and how does it apply to transport?

VAT (Value Added Tax) is a consumption tax applied to most goods and services sold in the UK. It’s charged at several rates:

• Standard rate: 20% (most goods and services)
• Reduced rate: 5% (certain items like home energy)
• Zero rate: 0% (goods and services that are taxable but taxed at 0%, allowing recovery of input VAT)
• Exempt: outside the VAT system (no VAT charged and no input tax recovery)

Passenger transport services, those that move people rather than goods, are taxable at the zero rate under Schedule 8, Group 8 of the VAT Act 1994. This means that the service is VAT-taxable but at 0%, so operators can reclaim input VAT on business expenses related to running the service, even though they do not charge VAT on fares.

Zero-rated vs exempt: why it matters

It’s important to distinguish between zero-rated and exempt supplies.

Passenger transport, including rail services, benefits from the zero-rated treatment. This is advantageous to operators like National Rail, Transport for Wales, ScotRail, and London Overground, as they can recover VAT on fuel, rolling stock maintenance, and other operating costs.

Which types of transport are zero-rated?

Under current HMRC guidance (VAT Notice 744A: Passenger Transport), the following types of passenger transport are zero-rated when certain conditions are met:

• Train travel within the UK
• Bus and coach services that are available to the general public
• Trams, ferries, and hovercraft
• Air travel within the UK (provided the service is “domestic” and open to the public)

However, the zero-rating only applies if the vehicle or vessel is “designed or adapted to carry 10 or more passengers (including the driver)”.

This means that taxis, minicabs, and chauffeur-driven cars do not qualify for zero-rating and are instead standard-rated at 20%.

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Are there any exceptions for train travel?

For most ordinary train journeys, the zero rate applies automatically. However, there are a few exceptions and nuances.

Catering on trains

‍Meals and drinks sold on board (e.g. in a buffet car or trolley service) are standard-rated.

Charter or private train hire

‍If a company or group hires an entire train or carriage for private use, this may not qualify as zero-rated passenger transport. The VAT treatment will depend on the nature of the service.

International journeys‍

Train travel that begins or ends outside the UK, such as the Eurostar, is treated differently. For journeys from the UK to France or Belgium, the UK portion is zero-rated, while the foreign portion is outside the scope of UK VAT.

The role of HMRC guidance

HMRC sets out detailed rules in VAT Notice 744A: Passenger Transport. This document clarifies what counts as “public transport,” what kinds of routes qualify, and how mixed supplies (like package tours) should be treated.

According to HMRC, to qualify for zero-rating:

• The service must be available to the general public or a section of it (e.g., rail commuters).
• It must run on a set route with scheduled stops.
• The vehicle must be designed or adapted to carry at least 10 passengers.

Since UK trains clearly meet all these criteria, train fares remain firmly within the zero-rated category.
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Why doesn’t VAT appear on train tickets?

You won’t usually see a VAT amount listed on a train ticket or online booking receipt because the VAT rate is 0%. Some tickets may include a note stating “VAT included at 0%,” but many omit it entirely, as no VAT is actually charged to the customer.

Behind the scenes, however, train operators still record and reclaim VAT on their business costs through their VAT returns, as they are making taxable (albeit zero-rated) supplies.

VAT on other related travel costs

If you’re purchasing travel-related services beyond the ticket itself, the VAT treatment may vary:

• Parking at stations: Usually standard-rated at 20%.
• Left luggage services: Standard-rated.
• Season tickets: Zero-rated (they’re just prepaid passenger transport).
• Railcards and discount schemes: Also zero-rated, as they relate directly to zero-rated transport.

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Post-Brexit and cross-border implications

Before Brexit, UK train travel connecting to EU destinations (such as the Eurostar) had to account for EU VAT rules. Now, post-Brexit, the UK applies its own rules to the UK portion of international transport.

Thus, for a London–Paris Eurostar ticket, the portion of the journey in the UK remains zero-rated, while the non-UK segment is outside the scope of UK VAT.

Summary table

So, is VAT added to UK train tickets?

There is no VAT added to UK train tickets. The fares are zero-rated, meaning passengers don’t pay VAT but operators can reclaim it on their costs. This treatment supports the affordability and operation of public transport across the UK and ensures that the system remains consistent with the VAT treatment of other mass transit modes like buses and ferries.

If you ever see “VAT included at 0%” on a receipt, it’s simply a reflection of this rule: your train fare is within the VAT system, but you’re not paying extra for it.

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