Category: Transportation Network Companies

A Complete 2025 Guide To FRS 102 Compliance for TNCs in the UK

Posted on by Sidra

For growing Transportation Network Companies (TNCs), staying FRS 102-compliant is essential to maintain accurate reporting and investor confidence. In March 2024, the Financial Reporting Council (FRC) released its second periodic review of FRS 102, introducing significant updates. Most changes take effect for accounting periods starting on or after 1 January 2026, with early adoption available, while new supplier-finance disclosure requirements apply from 1 January 2025. In this guide, we’ll discuss the key updates like  lease accounting changes under FRS 102, how they impact TNC operations, and practical steps to prepare for smooth FRS 102 Compliance for TNCs.

What’s Changing in FRS 102 Compliance For TNCs

Lease accounting changes under FRS 102 – Section 20

Most leases will move onto the balance sheet. TNCs must record a right-of-use (ROU) asset and a lease liability. Short-term leases (12 months or less) and low-value assets may be exempt. This change will increase assets and liabilities and could affect debt covenants.

Revenue Recognition – Section 23

A new five-step revenue recognition model, aligned with IFRS 15, will apply:

  1. Identify contracts
  2. Identify performance obligations
  3. Determine transaction price
  4. Allocate price to obligations
  5. Recognise revenue when control transfers

TNCs must apply this to ride fees, delivery charges, subscriptions, and promotional pricing.

Other Updates

 FRS 102 now aligns with the IASB’s Conceptual Framework. Section 2A introduces a clearer fair-value definition. New supplier-finance disclosure rules (effective from 2025) require more detail on payment terms and liquidity risk. Updated FRC factsheets offer guidance on implementing Sections 20 and 23.

How TNCs Should Respond

  • Lease reviews – catalogue all contracts, renewal terms, and embedded leases.
  • Covenant analysis – assess how balance-sheet changes may impact lender agreements.
  • Revenue mapping – align data systems with the five-step model.
  • Automation – use software to handle ROU asset calculations, revenue allocation, and disclosures.
  • Clear disclosures – prepare for expanded transparency requirements.
  • Cross-team training – ensure finance, products, and operations share a consistent approach.
  • Dual reporting – run FRS 102 and legacy reports in parallel during the transition.

Why This Matters

TNCs depend heavily on leased vehicles, equipment, and technology. Bringing these leases onto the balance sheet changes financial ratios and investor perceptions. Updated revenue rules can alter reported earnings and cash flow patterns. Early preparation avoids disruption and supports stakeholder confidence.

How Apex Accountants Can Help

At Apex Accountants, we provide sector-specific support and accounting services for growing TNCs adjusting to the revised FRS 102. Our services include:

  • FRS 102 readiness assessments – identifying key gaps and risks in current reporting.
  • Lease accounting implementation – building ROU asset and liability registers and modelling covenant impacts.
  • Revenue recognition alignment – mapping every service line to the new performance-obligation framework.
  • Automation and system integration – deploying cloud-based tools to streamline calculations and reconciliations.
  • Disclosure pack preparation – ensuring supplier finance and other new disclosures are complete, clear, and compliant.
  • Training workshops – equipping finance teams and management with practical FRS 102 knowledge.
  • Ongoing advisory – providing quarterly reviews, audit-ready reports, and real-time compliance monitoring.

We combine the most recent accounting technology, technical expertise, and experience unique to TNC. That means cleaner data, faster reporting, and fewer surprises at year-end.

Case Study – Preparing a TNC for 2026 FRS 102 Changes

A UK-based ride-hailing platform with over 1,500 vehicles faced challenges in mapping revenue to new FRS 102 rules. Lease obligations were off-balance sheet, and supplier-finance terms weren’t fully documented. Apex Accountants carried out a full compliance readiness review, set up lease accounting software, and redesigned revenue recognition processes. By the next quarter, the client had complete disclosure packs, accurate ROU asset calculations, and parallel GAAP reporting in place, ready for early adoption.

Conclusion 

FRS 102 compliance is not just about ticking a box. It’s about embedding new processes that strengthen decision-making and business resilience. Apex Accountants can guide your company through every step of the 2026 changes – keeping you compliant, efficient, and future-ready through our expert accounting services for growing TNCs.

Contact us today to arrange a confidential discussion about your compliance strategy and see how we can prepare your business for the upcoming changes.

How VAT for Ride-Sharing Companies Can Prevent Fare Increases

Posted on by Sidra

As a ride-sharing company in the UK, managing VAT is crucial. Failing to optimise VAT for ride-sharing companies could lead to a 20% fare increase. This would impact both your business and your customers. With the current VAT registration threshold and tax rules, it’s important to act. In this article, we’ll explore effective strategies for ride-sharing companies. These VAT strategies will help ensure compliance and keep fares competitive.

Understanding VAT for Ride-Sharing Companies

In the UK, VAT applies to all businesses that exceed the VAT registration threshold of £90,000 in taxable turnover. Once a business reaches this figure, it must register for VAT with HMRC and charge VAT on the services it provides. For ride-sharing companies, this means fares could increase by 20% to account for the VAT charge. However, with careful planning and the right VAT optimisation strategies, businesses can avoid these additional costs and continue to provide affordable services to their customers.

VAT for Uber in the UK

In the UK, VAT for Uber has changed significantly in recent years. Following legal rulings, Uber is treated as the principal supplier for journeys in London, meaning it must charge 20% VAT on the full fare, not just its commission. This has raised concerns about fare increases for passengers. However, outside London, a 2025 Supreme Court decision confirmed that private-hire operators are not required to add 20% VAT to fares. Uber is also exploring the Tour Operators’ Margin Scheme (TOMS), which could allow VAT to be charged only on its margin rather than the full fare. If successful, this could lower VAT costs and help keep prices competitive for customers.

VAT Strategies for Ride-Sharing Companies

  1. Monitor Your Turnover Regularly

To avoid the 20% VAT charge, ride-sharing companies should monitor their turnover closely. If your turnover is approaching the £90,000 threshold, it’s essential to take proactive steps. By doing so, you can plan ahead and avoid VAT registration, preventing the need to increase fares.

  1. Utilise VAT Schemes

Ride-sharing companies can benefit from VAT schemes such as the Flat Rate Scheme, which simplifies VAT reporting and may reduce the overall VAT liability. Alternatively, the Cash Accounting Scheme allows businesses to pay VAT only on the payments they’ve received, helping improve cash flow and reduce upfront VAT costs.

  1. Leverage VAT Exemptions

Some ride-sharing services, such as those involving transport for medical or charitable purposes, may be exempt from VAT. Consulting with a tax advisor can help identify any services that may qualify for exemptions, allowing you to reduce your VAT burden.

  1. Separate Taxable and Non-Taxable Services

Not all services offered by ride-sharing companies are subject to VAT. For instance, additional services like food delivery may have different VAT rules. By reviewing and categorising your services correctly, you can optimise VAT charges and keep your pricing competitive.

  1. Consult a VAT Specialists For Ride-Sharing Companies

Given the complexity of VAT regulations, seeking professional advice is highly recommended. A VAT advisor can ensure that your business is compliant with all tax requirements and identify strategies to optimise VAT payments.

Conclusion

VAT for ride-sharing companies can be complex, but with the right strategies, you can prevent a 20% fare increase while staying compliant with HMRC regulations. By regularly monitoring turnover, using VAT schemes, and applying practical VAT strategies for ride-sharing companies, you can optimise VAT. Consulting with tax professionals will further help reduce unnecessary costs and keep your pricing competitive.

At Apex Accountants, our VAT specialists for ride-sharing companies specialise in providing customised VAT strategies and support. Let us help you manage VAT efficiently, ensuring your business remains competitive while complying with UK tax laws. Contact us today to learn how we can support you in navigating VAT for ride-sharing companies.

How UK Ride-Sharing Companies Can Optimise Their Business Structure After the 2025 Uber Supreme Court Ruling

Posted on by Sidra

The 2025 Uber Supreme Court ruling has impacted ride-sharing companies in the UK. This ruling brings both challenges and opportunities. As the legal and regulatory environment evolves, businesses must adapt. They need to adjust their structure to ensure compliance while staying efficient and profitable. At Apex Accountants, we understand these changes. We offer strategic advice on tax-efficient business structure for ride-sharing companies.

Understanding the 2025 Uber Supreme Court Ruling

The landmark 2025 Uber Supreme Court ruling reinforced the rights of drivers as workers. This includes entitlements like holiday pay and a minimum wage. The decision has major implications for ride-sharing businesses. Companies must reassess how they manage their workforce. They also need to review the legal structure for ride-sharing companies. Compliance with employment law is now crucial.

Business Structure Optimisation Strategies

Review Employment Status

One of the immediate changes ride-sharing companies must make is a comprehensive review of their driver contracts and working arrangements. Ensuring that drivers are classified correctly is crucial for compliance with the ruling. Companies may need to shift from an independent contractor model to one that acknowledges drivers as employees or workers, which impacts payroll, tax obligations, and benefits.

Enhance Financial Systems

With the changes in workforce management, ride-sharing companies must adapt their accounting systems to handle new costs. This includes implementing payroll systems that cater to employee benefits, such as paid holidays, pensions, and National Insurance contributions. Accurate bookkeeping and financial reporting will also be essential for complying with UK tax law and maintaining profitability.

Tax Planning and Compliance

The ruling may lead to increased operational costs, and companies must plan their tax strategies accordingly. It’s vital for ride-sharing businesses to engage in proactive tax planning, particularly around VAT, employment taxes, and corporation tax. Our tax advisory team at Apex Accountants can help you develop strategies and choose tax-efficient business structures for ride-sharing companies that minimise liabilities while remaining fully compliant with regulations.

Adapt to Market Changes

With these changes, businesses will need to adapt their business model to remain competitive. Reviewing pricing strategies, restructuring service offerings, and exploring new revenue streams such as subscription models or partnerships with local businesses can all help drive growth in a more regulated environment.

Conclusion

The 2025 Uber Supreme Court ruling represents a pivotal moment for UK ride-sharing companies. By optimising business structures for ride-sharing companies, adopting robust financial practices, and ensuring compliance, companies can navigate the evolving landscape while positioning themselves for sustainable success. For expert guidance and tailored solutions, Apex Accountants is here to help you adapt and thrive. Contact us today to learn more about how we can assist with optimising legal structures for ride-sharing companies and their tax planning needs.

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