Beginner’s Guide on Starting a Mini Cab Business in the United Kingdom

Starting a Mini Cab Business in the United KingdomThe government’s report (Taxi and Private Hire Vehicle Statistics: England 2020) shows that there are about 67,900 taxis in the United Kingdom. This number could seem big, but let’s say, taxis won’t be out of demand anytime soon when we factor in the 67 million people that are currently living in the country. And with the ongoing trends and changing people’s behaviour, starting a mini cab business is one of the right ways to get into the venture.


What Is a Mini Cab Business?

A mini cab is a special cab that you can book but can’t hail down on the street. It offers more privacy and convenience to passengers as they can board the transportation in advance. The business can really kick off, as we are in the generation of carpooling where people are always looking to make the bookings for private vehicles comfortable and effortless.

The law specifically stipulates that mini cabs can’t be hailed down in the street. Furthermore, the vehicle falls under the private hire category, so you shouldn’t mistake it for a taxi. The licencing procedures and the vehicle sizes and driving eligibility also vary between a taxi and a mini cab. A mini cab business in the United Kingdom can consist of a person running a single mini cab or a company owner hiring several mini cab drivers who meet the required qualifications.


Mini Cab Trends in the United Kingdom

Before starting a mini cab business, it will be helpful to know about the trends to get a fair idea of what to expect and offer:

Technological innovations that have taken place over the last ten years have changed the face of the cab industry. The private vehicle services market in each country changes as per the various socio-economic and political situations in the country. We have analysed the main trends in the cab market in the United Kingdom and how they affect transport.

Environmentally Friendly Cabs

The emergence of environmentally-friendly electric cab services is likely to provide lucrative growth opportunities for the transportation market in the following years. Furthermore, the improvement of in-laws for electric vehicles can be expected, which is going to significantly help anyone looking to venture into the mini cab business. Moreover, operating an electric vehicle is cheaper compared to fossil fuels, helping you be more efficient with the budget.

Ride-Sharing Services

One reason why investors are considering a mini cab business more than a taxi is because of ride-sharing. In recent years, the preference of passengers to use ride-sharing services has rapidly increased in the United Kingdom. Operators such as Uber and Lyft have become huge drivers of the market, and this will continue in the coming years. So, based on how you want to operate, you can decide to work with any one of them.

Personal Ride-Sharing Apps

Of course, you could knock on the doors of Uber and Lyft as platforms to find passengers, but you could do it yourself as well. Many businesses have created their own platforms, such as websites and apps for passengers to find them. Furthermore, some companies have begun carpooling services, which basically means boarding more than one passenger at once. With a mini cab business, creating a platform will be easier because it’s essentially just choosing a driver and a pickup time.


The Process for Starting a Mini Cab Business in the United Kingdom

After the trends, now let’s jump into the actual process of starting a mini cab business. You can register yourself, but taking assistance from a United Kingdom company incorporation services provider will make your job effortless.

Research the Market

The first step is researching the market and location and actually deciding if starting a mini cab business is for you. Since there already are a lot of transportation services in the United Kingdom, you will have to make sure that you start a mini cab business and still be relevant.

While researching the market, you have to consider your own factors, such as your budget and the hours you are willing to put into growing your business. From investing your money in a vehicle and potentially some websites, will it all be worth it? Does the market give you the returns from your tasks, or is there something better? You have to be very sure of these questions before moving forth.

Choose a Location

While choosing a location, you have to look for a place where there isn’t as much transportation as needed. Or, target a place where the public transportation isn’t as good as it is supposed to be. Furthermore, areas with fewer cars can be excellent for your business.

The demography of the place also plays a huge factor in the market. For example, places, where there are a lot of elderly, can be a great place to operate your vehicle. Furthermore, trends and research have shown that females tend to board taxis more than males.

Prepare a Business Plan

Your business plan should be as detailed and comprehensive as possible. There, you have to write about your goals and also decide how you want to reach those goals. You can also add daily notifications to exactly understand where you are standing with respect to your aspirations.

In your business plan, you also have to include your marketing ideas and unique selling point. Remember, you aren’t looking for random passengers but are targeting people that will be happy with your service and will recommend you to others. That way, you will build your brand rather than just a mini cab business.

Register Your Business

After preparing to run your business, you will need to register your company. If you are a single owner, you can start a sole proprietorship. The partnership is available if you have business partners and if you want to make your business bigger with multiple cabs in the future, go for a limited liability company.

Of course, different companies have their own pros and cons. Furthermore, they have different requirements. Factor all those in before making a decision. You also have to register for the taxes for each business entity. For more information, see our guide to company registration in the UK.


Licences Needed for Starting a Mini Cab Business in the United Kingdom

There are three classes of licences required for starting a mini cab business in the United Kingdom, including a driving licence, an operator licence, and a vehicle licence.

Operator Licences for Starting a Mini Cab Business in the United Kingdom

There are different criteria for the operators’ licences in different parts of the United Kingdom. You have to understand the requirements of your local town council. For a rough idea, here are the requirements for operator’s licences for starting a private hire vehicle in London:

  • A small operator’s licence if you want to operate up to two vehicles for private hire bookings.
  • A standard operator’s licence for more than two vehicles.

Note: The validity for each licence is five years in London and can be up to five years in other places.

You can be prosecuted if you receive payment for taking bookings or supply drivers for hire without an operator’s licence. To be sure you fulfil all the requirements, it is a great idea to work with a UK corporate service provider like 3E Accounting.

Requirements for a Private Hire Driving Licence in the United Kingdom

Again, the requirements vary but are similar in general. Here are the requirements for getting a private hire driving licence:

  • You need to be able to work legally in the UK.
  • You should be a person of good character. Having no criminal charges can help with this.
  • You should have held a full GB or Northern Ireland driving licence – or a full EU driving licence – for at least 12 months to up to 3 years old, depending on the state.
  • Finally, you may also need a medical examination, a knowledge test, a topographical assessment, or take a driving test.

Requirements for a Vehicle Licence for a Mini Cab in the United Kingdom

Again, you need to apply for this one with your local town council. Here are the eligibilities:

  • You need to get a licence for each vehicle you want to operate. Furthermore, any vehicle must not have more than eight passenger seats.
  • Your council may also check your vehicle up to three times to check it is:
    • roadworthy
    • comfortable and clean
    • if the taximeter works properly
    • if the doors are secure and safe
    • roof signs and the colour scheme of the vehicle to ensure people don’t confuse your mini cab for a taxi.

You’ll also need insurance under your name as a driver. It should cover you for hire and reward. Furthermore, if any problems occur, you need to fix the problems within two months of failing a test.



The transportation business may have slowed down due to the COVID-19 pandemic, but it still is one of the essential services which will never go out of demand. Thus, starting a mini cab business is never going to be a bad idea. However, you have to keep in mind the technological advancements and marketing strategies so that you don’t be left behind.

You can contact 3E Accounting United Kingdom for starting a mini cab business in the UK. We will help you register your company, and also with the tax and licences. Furthermore, we can offer guidance and other essential services you will need to grow your mini cab business.

Starting a Mini Cab Business in the United Kingdom