The short answer
In a metered black cab, round up to the nearest pound or add roughly ten per cent on a longer journey. In a pre-booked fixed-fare transfer, tipping is genuinely optional and most passengers do not tip at all. If a driver has carried heavy luggage, waited a long time for a delayed flight or gone out of their way, five to ten pounds is a generous and completely normal gesture.
Why the UK is different
In the United States, tipping subsidises wages. In the UK it does not. Licensed drivers are paid from the fare itself, and on a pre-booked transfer the fare is agreed before the car is dispatched. That means the amount you were quoted is the amount the job is worth. A tip is a bonus, not a correction.
This is the single biggest source of confusion for visitors. Travellers arriving from North America frequently over-tip out of anxiety, then feel resentful about it. Travellers arriving from Japan, China or much of continental Europe sometimes assume tipping is rude. Neither reaction is necessary. In London a tip is read as a small thank-you, nothing more loaded than that.
Black cab, minicab or pre-booked transfer
Licensed black cabs
Hackney carriages run on a meter, and the meter can land on awkward figures. Rounding up is the near-universal habit. If the meter says twenty-three pounds forty, most Londoners hand over twenty-five and leave it. On a long run the ten per cent convention applies more loosely than people expect.
Private hire minicabs booked on the street or by phone
These are usually quoted or metered locally. The same rounding-up habit applies. Cash tips reach the driver directly.
Pre-booked fixed-fare airport transfers
This is where the convention is weakest and passengers most often overthink it. The fare is fixed in advance, includes meet and greet, includes a waiting allowance and does not change if traffic is bad. Because everything is priced in, there is no shortfall for a tip to make up. Most passengers tip nothing and that is entirely unremarkable. Passengers who do tip usually do so because the driver did something specific and visible.
When a tip genuinely makes sense
There are a handful of situations where drivers do notice and appreciate a tip, and they have very little to do with the length of the journey.
Heavy or awkward luggage is the clearest one. A driver who has loaded four large suitcases, a pushchair and a set of golf clubs into a boot in the rain has done manual work that was not in the fare. A long wait for a delayed flight is another. On a tracked arrival transfer the driver monitors the flight and stays, which can mean two extra hours in an airport car park. Journeys that turn into something more than a transfer count too, such as an unscheduled stop, help finding an unmarked address, or carrying bags up to a doorway.
Conversely, there is no expectation to tip for the basics. Turning up on time, driving safely and putting your bag in the boot is the job.
Cash or card
Cash goes straight to the driver, which is the main practical argument for it. Card tips added through an app or terminal generally reach the driver too, but the routing depends on the operator. If you want to be certain the money lands with the person who drove you, a note in the hand is unambiguous. If you have no sterling, do not worry about it. Arriving passengers frequently have no UK cash at all, and drivers know that.
What drivers say they value more than money
Ask working drivers and the answers are consistent and slightly deflating for anyone reaching for their wallet. Being ready when the car arrives ranks higher than a tip. So does telling the operator in advance about extra luggage, a child seat or a mobility need. So does a quick message if you are held up at baggage reclaim. And so does a decent review, which is worth considerably more to a driver's week than five pounds.
Group and business travel
On a corporate account the fare is usually billed centrally and tipping is neither expected nor easy to expense. If the transfer is for a group, a single tip from the group rather than several small ones is simpler for everyone. For a multi-day booking with the same driver, many passengers prefer to tip once at the end rather than after each leg.