PCO licence renewal vs selling: how to decide in 2026

If you renew, you pay TfL's PHV licence fee (£114 in 2026 for the standard 12-month renewal, broadly stable in recent years), plus MOT and service costs (£500 to £1,200 depending on what the cab needs), plus any compliance work (tyres, battery health check on hybrids, brake pads if marginal). Call the all-in cost of getting one more cycle out of the cab £700 on the low end, £1,800 on the high end. In return you get another 12 months of earning at whatever your weekly take-home is, minus the costs of running the cab for that period, minus the depreciation that 12 months puts on the resale value at the end.

If you sell, you crystallise the current trade value of the cab right now. For a typical 6 to 9 year old PCO Prius or Corolla Hybrid with a live plate, that is £6,000 to £12,000 in 2026 depending on generation, mileage, condition, and remaining plate validity. The cash is in your account on collection day; you stop accruing repair costs, depreciation, and insurance from that day forward; and you free up the working capital that was sitting in the cab.

The decision is not which number is bigger, it is whether the net of (12 months income, less running costs, less depreciation between now and sale at end of cycle) is greater than zero after factoring in the time + stress cost of working another 12 months versus cashing out today.

Five things move the answer materially. In rough order of impact on the typical owner-driver decision:

• Time remaining on the plate. A cab with 3 to 6 years of plate validity remaining has flexibility (you can sell, you can renew, you can sell partway through). A cab with 9 to 18 months remaining is on a sharp value cliff; resale drops 10 to 20 per cent in the last 12 months as the plate becomes near-worthless to the buyer.
• Hybrid battery state-of-health (Prius / Corolla / Niro / Ioniq drivers). A cab with battery degradation at 70 to 75 per cent typically needs a £1,800 to £2,800 pack refurb during the next renewal cycle if you keep it. That cost falls on you; the resale buyer prices it in. Selling before the pack lets go transfers the timing risk.
• Age relative to the TfL 11-year PCO age limit (for non-WAV PHVs licensed first time after 2020). The PHV age regime is more nuanced than the Hackney 15-year rule but the practical effect is the same: cab value compresses sharply in the final 12 to 18 months before the licensing cap.
• Service-history continuity. A cab with full main-dealer service history sells at a clear premium over partial-history equivalents. If your service intervals are slipping (you have skipped 1 or 2 cycles in the past few years), each additional 12 months without a stamp depresses the eventual resale price more than the cost of doing the service properly.
• Your personal financial position. The cab is a working capital asset. If you have an underlying need for the lump sum (deposit on a property, paying down higher-interest debt, family obligation), the income difference from one more renewal cycle is often less valuable than the cleared cash today.

Three things drivers worry about that turn out not to move the answer much:

• The cost of the TfL licence renewal itself (£114 in 2026). It is real money but it is small relative to the cab value swings driven by plate-time and battery health. Almost no renewal decision genuinely turns on the fee.
• Your current take-home weekly income. Drivers tend to anchor on the gross weekly figure but the renewal-vs-sell decision is driven by NET position after running costs, vehicle depreciation, downtime, and stress; many drivers run the maths on gross and get a misleading answer. If you have not done a net calculation in the past 12 months, it is worth doing one before deciding.
• Sunk costs in the cab (recent tyres, recent battery work, recent paint). They feel like reasons to keep running the cab to recover the spend. Economically they are sunk; the relevant comparison is forward income vs forward depreciation, not historical spend recovery. Drivers who anchor on sunk costs often over-renew.

Six weeks out from your PCO renewal date is the sweet spot for running the decision properly. Earlier and you do not yet know what the renewal cycle will require (the MOT advisory list, the service interval state, whether the battery health check will pass). Later and you are squeezed on time to sell before the existing plate expires, which compresses your buyer options.

At six weeks, three checkpoints to clear:

• Get the cab through an MOT pre-check (£20 to £40 at most independent garages). The advisory list tells you what the renewal cycle will actually cost in repairs and consumables. Without it, the renewal cost is a guess.
• Get a hybrid battery health check if applicable (£50 to £80 at a Toyota main dealer or specialist). The state-of-health reading either reassures you that the pack is good for another 24 months (renewal is viable) or warns you that a refurb is coming (sell now to transfer the timing risk).
• Get a current trade valuation from a specialist cab buyer. This takes 2 hours via /cab-valuation and gives you the cash-out number to compare against the all-in cost of the renewal cycle.

Three situations where renewal is the clear answer:

• Cab has 3 to 8 years of plate validity remaining, battery health is strong, service history is unbroken, and you have no underlying need for the lump sum. The cab is a productive asset; keep using it.
• You are 12 to 24 months from a planned event (retirement, emigration, family change) that will end your driving career anyway. Renewing once or twice more is a bridge; selling now sacrifices the income smoothing.
• Your local market conditions are favourable (your operator pays well, your shifts are reliably full, ride demand in your area is growing). Renewing locks in another year of strong earning at known terms; the resale market is not going anywhere.

Three situations where selling is the clear answer:

• Cab has 9 to 18 months of plate validity remaining and the renewal cycle will be a major spend (battery refurb, suspension overhaul, multiple tyres, accident damage). The forward income probably will not recover the spend before the plate value collapses.
• Battery health is below 70 per cent on a Gen 3 or Gen 4 Prius and the cab is 8+ years old. The next 12 months is when the pack typically gives up, and the cost falls entirely on you if you have not sold beforehand.
• You have an underlying need for the lump sum (housing deposit, debt consolidation, family obligation). The cleared cash today is worth more than the marginal income from one more renewal cycle, especially when working-capital alternatives are considered.

Most decisions are in the grey zone where neither answer is obviously right. The right move there is to run the actual numbers on your specific cab against a current trade valuation, not to rely on rules of thumb from forum posts or trade gossip. Two cabs of the same year, mileage, and trim can have £3,000 different valuations because of plate validity, battery state-of-health, and service-history continuity, and the rest of the maths follows from that.

If you are in the grey zone, the cheapest decision-aid is to get a real trade valuation today (no obligation), compare against your honest estimate of the all-in renewal cost, and make the call with real numbers. The valuation is firm for 72 hours; you have time to think.