How to expand a taxi business into a new town

The next town along looks like easy growth: same roads, same kind of customers, and passengers who already ring you for the odd job. Before you put cars there, get the licensing right, because the law treats "doing jobs in a town" and "running a firm in a town" very differently. This guide covers your options, the licences each one needs, the cross-border rules, what's changing in 2026, and how to set up drivers, phones and marketing for the new area.

What are your options for expanding into a new town?

You have four, and they need different licences.

Serving the town from your base costs least to start, and a licensed base can follow once the work is there. Buying a firm is its own project, covered in our guide to buying an existing taxi firm.

Do you need a new licence to work in another town?

Not to carry pre-booked passengers there, but yes to run an office there. GOV.UK says the driver licence, vehicle licence and operator licence all need to be issued by the same authority. When they are, a booking taken by your licensed operator can be carried out in the next town, including a pickup there.

The line is where you take bookings. Under the Local Government (Miscellaneous Provisions) Act 1976, to "operate" means to make provision in the course of business for inviting or accepting private hire bookings, and section 46 says no one may operate in a controlled district without that district's operator licence. So an office, a desk or a booking point in the new town needs the new council's licence. Bookings taken in your licensed office are taken under your existing licence, even when the passenger is in the new town. If you advertise a local number there, ask the new council how it views it.

Hackney carriages are different again. The Department for Transport's best practice guidance says holders of taxi licences can carry pre-booked fares anywhere in England and Wales. A hackney carriage can only ply for hire, on ranks and in the street, in the area that licensed it.

London and the other UK nations have their own rules. In London you need a Transport for London licence for an operating centre in London, and TfL says addresses outside Greater London need a licence from the local council. Northern Ireland and Scotland run separate systems, so get local advice before you cross either border.

How does cross-border hiring work since the Deregulation Act 2015?

Since 1 October 2015 a licensed operator in England and Wales outside London can pass a booking to another licensed operator. Section 11 of the Deregulation Act 2015 added sections 55A and 55B to the 1976 Act. Section 55A lets you subcontract bookings to an operator licensed in the same district, an operator licensed in a different district, a London operator, or an operator accepting the booking in Scotland. It doesn't matter whether your contract with the passenger allows subcontracting.

Section 55B protects you and sets one limit. You aren't treated as operating the vehicle just because you took the booking. But you commit an offence if you pass a booking to another operator licensed in England and Wales outside London and you knew they'd use a driver or vehicle their own council hadn't licensed.

So subcontracting is a fair way to test a new town. You keep the customer, a local licensed firm does the job, and you learn where the work really is before you spend money on a base. Our guide to cross-border hiring and subcontracting goes into the detail.

What's changing in taxi licensing in 2026?

Two things are coming, and neither was in force when this guide was checked.

The English Devolution and Community Empowerment Act 2026, which received Royal Assent on 29 April 2026, has a chapter on taxi and private hire licensing (sections 70 to 86). It provides for national standards on granting, suspending and renewing licences, changes to the duty on councils to report concerns about drivers licensed in other areas, and, in section 76, a power for an enforcement officer to suspend a driver, vehicle or private hire operator licence granted by any licensing authority in England when the vehicle is driven in the officer's area and it's necessary for public safety. Section 108 keeps that whole chapter out of force until the government sets a start date by regulations.

Then there's the size of licensing areas. On 8 January 2026 the Department for Transport opened a consultation on moving taxi and private hire licensing from councils to local transport authorities, cutting the number of licensing authorities from 263 to 70, which it said would help tackle out-of-area working. The consultation closed on 1 April 2026, and the government's response hadn't been published when this guide was checked.

The scale of out-of-area working is plain in the numbers. The Department for Transport's 2026 statistics found that Wolverhampton has licensed 13.1% of all private hire vehicles in England, and note that this reflects where vehicles are licensed, not necessarily where they operate.

What this means for you: if your plan relies on running cars in a town whose council never licensed them, remember that once section 76 is in force, that town's enforcement officers will be able to suspend a licence in the interests of public safety, whichever council in England issued it. A licensed base in the new area is the safer long-term plan.

How much does an operator licence cost in a new area?

Operator licence fees depend on the council, so check the fee page of the council for the town you're moving into. Three examples:

Budget for more than the fee. TfL says a typical application can take up to 16 weeks and needs evidence of planning permission for every operating centre. Your drivers for the new base need that council's driver licence too: Manchester adds a £74 knowledge test and a £42 skills assessment to its driver application. Our guide to taxi licence fees by council has more examples.

How do you find local drivers for the new town?

Recruit people who know the place. A passenger in a new town forgives a lot, but not a driver who can't find the station.

If you open a licensed base, the drivers working from it need driver licences from that council, which means its checks, its knowledge test and its waiting times. Start recruiting before the operator licence arrives, so you aren't paying for an office with nobody to send. Drivers already licensed by that council are the quickest start, and some will want to move from a firm they're unhappy with. Our guide to taxi driver recruitment covers where to find them.

If you're serving the town from your existing base, your current drivers do the work, so pair new drivers with someone who knows the area for their first few shifts there.

How do you set up phones and marketing in the new town?

Give the new town its own number that rings in your existing office, so local customers see a local number and your controllers see one list of jobs. Answer it in the name the customer expects.

Phones in a second town mean more calls at the same busy times. An AI phone agent answers your booking line when your office doesn't, quotes your own fixed prices and books the job into your Dispatch AI account, and it goes on by a call divert on your own line, at the hours you choose.

Then get found:

• Google Business Profile. Google's guidelines say a virtual office isn't eligible for a profile, and you shouldn't create more than one page for each location. If you serve the town from your current base, add it to your service area instead of inventing an address. If you open a real, staffed base, that location can have its own profile. Our guide to your Google Business Profile covers the set-up.
• Your website. A page for the new town with your fixed prices to its station, its town centre and its nearest airport.
• Local partners. Hotels, offices and venues in the new town, using the approach in our guide to hotel and venue partnerships.

When is a taxi firm ready to expand?

When the firm you've got runs without you. Expansion takes the owner's time, and the home town's work suffers first.

Check four things before you commit: the office copes with today's calls, nights included; you have spare cars and drivers at the busy times, not just in the quiet ones; someone can manage the new area day to day; and you have the cash to pay licence fees and carry a slow few months. The numbers worth watching are in our guide to taxi business numbers to track.