diff --git a/src/libs/actions/IOU/MoneyRequest.ts b/src/libs/actions/IOU/MoneyRequest.ts
index 777bd6a562606..e851d5cf2f526 100644
--- a/src/libs/actions/IOU/MoneyRequest.ts
+++ b/src/libs/actions/IOU/MoneyRequest.ts
@@ -16,9 +16,22 @@ import {setTransactionReport} from '@userActions/Transaction';
 import type {IOUType} from '@src/CONST';
 import CONST from '@src/CONST';
 import type {TranslationParameters, TranslationPaths} from '@src/languages/types';
+import ONYXKEYS from '@src/ONYXKEYS';
 import type {Route} from '@src/ROUTES';
 import ROUTES from '@src/ROUTES';
-import type {Beta, IntroSelected, LastSelectedDistanceRates, PersonalDetailsList, Policy, QuickAction, RecentWaypoint, Report, Transaction, TransactionViolation} from '@src/types/onyx';
+import type {
+    Beta,
+    IntroSelected,
+    LastSelectedDistanceRates,
+    PersonalDetailsList,
+    Policy,
+    PolicyTagLists,
+    QuickAction,
+    RecentWaypoint,
+    Report,
+    Transaction,
+    TransactionViolation,
+} from '@src/types/onyx';
 import type {ReportAttributes, ReportAttributesDerivedValue} from '@src/types/onyx/DerivedValues';
 import type {Participant} from '@src/types/onyx/IOU';
 import type {Unit} from '@src/types/onyx/Policy';
@@ -27,6 +40,7 @@ import type {GpsPoint} from './index';
 import {
     createDistanceRequest,
     getMoneyRequestParticipantsFromReport,
+    getPolicyTags,
     requestMoney,
     setCustomUnitRateID,
     setMoneyRequestDistance,
@@ -359,6 +373,13 @@ function handleMoneyRequestStepScanParticipants({
                 const splitReceipt: Receipt = firstReceiptFile.file ?? {};
                 splitReceipt.source = firstReceiptFile.source;
                 splitReceipt.state = CONST.IOU.RECEIPT_STATE.SCAN_READY;
+                const allPolicyTags: OnyxCollection<PolicyTagLists> = getPolicyTags();
+                const participantsPolicyTags = participants.reduce<Record<string, PolicyTagLists>>((acc, participant) => {
+                    if (participant.policyID) {
+                        acc[participant.policyID] = allPolicyTags?.[`${ONYXKEYS.COLLECTION.POLICY_TAGS}${participant.policyID}`] ?? {};
+                    }
+                    return acc;
+                }, {});
                 startSplitBill({
                     participants,
                     currentUserLogin: currentUserLogin ?? '',
@@ -376,6 +397,7 @@ function handleMoneyRequestStepScanParticipants({
                     policyRecentlyUsedCurrencies: policyRecentlyUsedCurrencies ?? [],
                     // No need to update recently used tags because no tags are used when the confirmation step is skipped
                     policyRecentlyUsedTags: undefined,
+                    participantsPolicyTags,
                 });
                 return;
             }
diff --git a/src/libs/actions/IOU/Split.ts b/src/libs/actions/IOU/Split.ts
index a24b957f5b72e..c313f5463093e 100644
--- a/src/libs/actions/IOU/Split.ts
+++ b/src/libs/actions/IOU/Split.ts
@@ -363,6 +363,7 @@ function startSplitBill({
     policyRecentlyUsedTags,
     quickAction,
     policyRecentlyUsedCurrencies,
+    participantsPolicyTags,
 }: StartSplitBilActionParams) {
     const currentUserEmailForIOUSplit = addSMSDomainIfPhoneNumber(currentUserLogin);
     const participantAccountIDs = participants.map((participant) => Number(participant.accountID));
@@ -546,6 +547,7 @@ function startSplitBill({
         quickAction,
         policyRecentlyUsedCurrencies,
         policyRecentlyUsedTags,
+        participantsPolicyTags,
     };
 
     if (existingSplitChatReport) {
@@ -639,9 +641,7 @@ function startSplitBill({
         }
         const optimisticPolicyRecentlyUsedCategories = mergePolicyRecentlyUsedCategories(category, policyRecentlyUsedCategories);
         const optimisticPolicyRecentlyUsedTags = buildOptimisticPolicyRecentlyUsedTags({
-            // TODO: remove `allPolicyTags` from this file [https://github.com/Expensify/App/issues/80401]
-            // eslint-disable-next-line @typescript-eslint/no-deprecated
-            policyTags: getPolicyTagsData(participant.policyID),
+            policyTags: participant.policyID ? participantsPolicyTags[participant.policyID] : {},
             policyRecentlyUsedTags,
             transactionTags: tag,
         });
diff --git a/src/libs/actions/IOU/index.ts b/src/libs/actions/IOU/index.ts
index f6e92b2b67641..0f61eed08ede8 100644
--- a/src/libs/actions/IOU/index.ts
+++ b/src/libs/actions/IOU/index.ts
@@ -837,6 +837,7 @@ type StartSplitBilActionParams = {
     policyRecentlyUsedTags: OnyxEntry<RecentlyUsedTags>;
     quickAction: OnyxEntry<OnyxTypes.QuickAction>;
     policyRecentlyUsedCurrencies: string[];
+    participantsPolicyTags: Record<string, OnyxTypes.PolicyTagLists>;
 };
 
 type ReplaceReceipt = {
diff --git a/src/pages/iou/request/step/IOURequestStepConfirmation.tsx b/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
index e34c62f7fbfb3..749ca5052be92 100644
--- a/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
+++ b/src/pages/iou/request/step/IOURequestStepConfirmation.tsx
@@ -104,7 +104,7 @@ import CONST from '@src/CONST';
 import ONYXKEYS from '@src/ONYXKEYS';
 import ROUTES from '@src/ROUTES';
 import type SCREENS from '@src/SCREENS';
-import type {RecentlyUsedCategories, Report} from '@src/types/onyx';
+import type {PolicyTagLists, RecentlyUsedCategories, Report} from '@src/types/onyx';
 import type {Participant} from '@src/types/onyx/IOU';
 import type {PaymentMethodType} from '@src/types/onyx/OriginalMessage';
 import type {InvoiceReceiver} from '@src/types/onyx/Report';
@@ -207,6 +207,7 @@ function IOURequestStepConfirmation({
 
     const [policyCategoriesDraft] = useOnyx(`${ONYXKEYS.COLLECTION.POLICY_CATEGORIES_DRAFT}${draftPolicyID}`);
     const [policyRecentlyUsedCategories] = useOnyx(`${ONYXKEYS.COLLECTION.POLICY_RECENTLY_USED_CATEGORIES}${policyID}`);
+    const [allPolicyTags] = useOnyx(ONYXKEYS.COLLECTION.POLICY_TAGS);
     const [policyTags] = useOnyx(`${ONYXKEYS.COLLECTION.POLICY_TAGS}${policyID}`);
     const [policyRecentlyUsedTags] = useOnyx(`${ONYXKEYS.COLLECTION.POLICY_RECENTLY_USED_TAGS}${policyID}`);
     const [policyRecentlyUsedCurrencies] = useOnyx(ONYXKEYS.RECENTLY_USED_CURRENCIES);
@@ -1084,6 +1085,13 @@ function IOURequestStepConfirmation({
                         }
                         const itemTrimmedComment = item?.comment?.comment?.trim() ?? '';
 
+                        const participantsPolicyTags = selectedParticipants.reduce<Record<string, PolicyTagLists>>((acc, participant) => {
+                            if (participant.policyID) {
+                                acc[participant.policyID] = allPolicyTags?.[`${ONYXKEYS.COLLECTION.POLICY_TAGS}${participant.policyID}`] ?? {};
+                            }
+                            return acc;
+                        }, {});
+
                         // If we have a receipt let's start the split expense by creating only the action, the transaction, and the group DM if needed
                         startSplitBill({
                             participants: selectedParticipants,
@@ -1104,6 +1112,7 @@ function IOURequestStepConfirmation({
                             policyRecentlyUsedTags,
                             quickAction,
                             policyRecentlyUsedCurrencies: policyRecentlyUsedCurrencies ?? [],
+                            participantsPolicyTags,
                         });
                     }
                 }
@@ -1327,6 +1336,7 @@ function IOURequestStepConfirmation({
             reportID,
             requestType,
             betas,
+            allPolicyTags,
         ],
     );
 
diff --git a/tests/actions/IOUTest.ts b/tests/actions/IOUTest.ts
index b77d7abf57d32..5bea71f7ab901 100644
--- a/tests/actions/IOUTest.ts
+++ b/tests/actions/IOUTest.ts
@@ -84,7 +84,7 @@ import * as SearchQueryUtils from '@src/libs/SearchQueryUtils';
 import ONYXKEYS from '@src/ONYXKEYS';
 import ROUTES from '@src/ROUTES';
 import type {IntroSelected, PersonalDetailsList, Policy, PolicyTagLists, RecentlyUsedTags, RecentWaypoint, Report, ReportNameValuePairs, SearchResults} from '@src/types/onyx';
-import type {Accountant, Attendee, SplitExpense} from '@src/types/onyx/IOU';
+import type {Accountant, Attendee, Participant as IOUParticipant, SplitExpense} from '@src/types/onyx/IOU';
 import type {CurrentUserPersonalDetails} from '@src/types/onyx/PersonalDetails';
 import type {Participant} from '@src/types/onyx/Report';
 import type ReportAction from '@src/types/onyx/ReportAction';
@@ -207,6 +207,23 @@ describe('actions/IOU', () => {
         avatar: 'https://example.com/avatar.jpg',
     };
 
+    const getParticipantsPolicyTags = async (participants: IOUParticipant[]) => {
+        let participantsPolicyTags: Record<string, PolicyTagLists> = {};
+        await getOnyxData({
+            waitForCollectionCallback: true,
+            key: `${ONYXKEYS.COLLECTION.POLICY_TAGS}`,
+            callback: (tags) => {
+                participantsPolicyTags = participants.reduce<Record<string, PolicyTagLists>>((acc, participant) => {
+                    if (participant.policyID) {
+                        acc[participant.policyID] = tags?.[`${ONYXKEYS.COLLECTION.POLICY_TAGS}${participant.policyID}`] ?? {};
+                    }
+                    return acc;
+                }, {});
+            },
+        });
+        return participantsPolicyTags;
+    };
+
     beforeAll(() => {
         Onyx.init({
             keys: ONYXKEYS,
@@ -5514,9 +5531,12 @@ describe('actions/IOU', () => {
                 },
             });
 
+            const participants: IOUParticipant[] = [{accountID: CARLOS_ACCOUNT_ID, login: CARLOS_EMAIL}];
+            const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
             // Start a scan split bill
             const {splitTransactionID} = startSplitBill({
-                participants: [{accountID: CARLOS_ACCOUNT_ID, login: CARLOS_EMAIL}],
+                participants,
                 currentUserLogin: RORY_EMAIL,
                 currentUserAccountID: RORY_ACCOUNT_ID,
                 comment: '# test',
@@ -5530,6 +5550,7 @@ describe('actions/IOU', () => {
                 quickAction: undefined,
                 policyRecentlyUsedCurrencies: [],
                 policyRecentlyUsedTags: undefined,
+                participantsPolicyTags,
             });
 
             await waitForBatchedUpdates();
@@ -5730,9 +5751,12 @@ describe('actions/IOU', () => {
             });
             await Onyx.merge(`${ONYXKEYS.COLLECTION.POLICY_RECENTLY_USED_TAGS}${policyID}`, policyRecentlyUsedTags);
 
+            const participants: IOUParticipant[] = [{isPolicyExpenseChat: true, policyID}];
+            const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
             // When doing a split bill with a receipt
             startSplitBill({
-                participants: [{isPolicyExpenseChat: true, policyID}],
+                participants,
                 currentUserLogin: currentUserPersonalDetails.login ?? '',
                 currentUserAccountID: currentUserPersonalDetails.accountID,
                 comment: '',
@@ -5745,6 +5769,7 @@ describe('actions/IOU', () => {
                 policyRecentlyUsedTags,
                 quickAction: {},
                 policyRecentlyUsedCurrencies: [],
+                participantsPolicyTags,
             });
 
             waitForBatchedUpdates();
diff --git a/tests/actions/IOUTest/SplitTest.ts b/tests/actions/IOUTest/SplitTest.ts
index ce544d1c17cf8..ded1cf5eac35e 100644
--- a/tests/actions/IOUTest/SplitTest.ts
+++ b/tests/actions/IOUTest/SplitTest.ts
@@ -30,7 +30,7 @@ import CONST from '@src/CONST';
 import IntlStore from '@src/languages/IntlStore';
 import DateUtils from '@src/libs/DateUtils';
 import ONYXKEYS from '@src/ONYXKEYS';
-import type {Policy, RecentlyUsedTags, Report, ReportNameValuePairs, SearchResults} from '@src/types/onyx';
+import type {Policy, PolicyTagLists, RecentlyUsedTags, Report, ReportNameValuePairs, SearchResults} from '@src/types/onyx';
 import type {Participant as IOUParticipant, SplitExpense} from '@src/types/onyx/IOU';
 import type {CurrentUserPersonalDetails} from '@src/types/onyx/PersonalDetails';
 import type {Participant} from '@src/types/onyx/Report';
@@ -129,6 +129,23 @@ const currentUserPersonalDetails: CurrentUserPersonalDetails = {
     avatar: 'https://example.com/avatar.jpg',
 };
 
+const getParticipantsPolicyTags = async (participants: IOUParticipant[]) => {
+    let participantsPolicyTags: Record<string, PolicyTagLists> = {};
+    await getOnyxData({
+        waitForCollectionCallback: true,
+        key: `${ONYXKEYS.COLLECTION.POLICY_TAGS}`,
+        callback: (tags) => {
+            participantsPolicyTags = participants.reduce<Record<string, PolicyTagLists>>((acc, participant) => {
+                if (participant.policyID) {
+                    acc[participant.policyID] = tags?.[`${ONYXKEYS.COLLECTION.POLICY_TAGS}${participant.policyID}`] ?? {};
+                }
+                return acc;
+            }, {});
+        },
+    });
+    return participantsPolicyTags;
+};
+
 let mockFetch: MockFetch;
 
 beforeAll(() => {
@@ -1017,6 +1034,9 @@ describe('split expense', () => {
             },
         });
 
+        const participants: IOUParticipant[] = [{accountID: CARLOS_ACCOUNT_ID, login: CARLOS_EMAIL}];
+        const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
         // Start a scan split bill
         const {splitTransactionID} = startSplitBill({
             participants: [{accountID: CARLOS_ACCOUNT_ID, login: CARLOS_EMAIL}],
@@ -1033,6 +1053,7 @@ describe('split expense', () => {
             quickAction: undefined,
             policyRecentlyUsedCurrencies: [],
             policyRecentlyUsedTags: undefined,
+            participantsPolicyTags,
         });
 
         await waitForBatchedUpdates();
@@ -1231,9 +1252,12 @@ describe('startSplitBill', () => {
         });
         await Onyx.merge(`${ONYXKEYS.COLLECTION.POLICY_RECENTLY_USED_TAGS}${policyID}`, policyRecentlyUsedTags);
 
+        const participants: IOUParticipant[] = [{isPolicyExpenseChat: true, policyID}];
+        const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
         // When doing a split bill with a receipt
         startSplitBill({
-            participants: [{isPolicyExpenseChat: true, policyID}],
+            participants,
             currentUserLogin: currentUserPersonalDetails.login ?? '',
             currentUserAccountID: currentUserPersonalDetails.accountID,
             comment: '',
@@ -1246,6 +1270,7 @@ describe('startSplitBill', () => {
             policyRecentlyUsedTags,
             quickAction: {},
             policyRecentlyUsedCurrencies: [],
+            participantsPolicyTags,
         });
 
         waitForBatchedUpdates();
@@ -1263,6 +1288,92 @@ describe('startSplitBill', () => {
         expect(newPolicyRecentlyUsedTags[tagName].length).toBe(2);
         expect(newPolicyRecentlyUsedTags[tagName].at(0)).toBe(transactionTag);
     });
+
+    it('should return splitTransactionID and create the transaction in Onyx with correct values', async () => {
+        // Given a participant
+        const policyID = 'A';
+        const testComment = 'Test split comment';
+        const testCategory = 'Food';
+        const testCurrency = CONST.CURRENCY.USD;
+
+        const participants: IOUParticipant[] = [{isPolicyExpenseChat: true, policyID, accountID: RORY_ACCOUNT_ID}];
+        const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
+        // When starting a split bill
+        const {splitTransactionID} = startSplitBill({
+            participants,
+            currentUserLogin: currentUserPersonalDetails.login ?? '',
+            currentUserAccountID: currentUserPersonalDetails.accountID,
+            comment: testComment,
+            receipt: {},
+            category: testCategory,
+            tag: '',
+            currency: testCurrency,
+            taxCode: '',
+            taxAmount: 0,
+            quickAction: undefined,
+            policyRecentlyUsedCurrencies: [],
+            policyRecentlyUsedTags: undefined,
+            participantsPolicyTags,
+        });
+
+        await waitForBatchedUpdates();
+
+        // Then the returned splitTransactionID should be defined
+        expect(splitTransactionID).toBeDefined();
+
+        // And the transaction should be created in Onyx with correct values
+        const createdTransaction = await getOnyxValue(`${ONYXKEYS.COLLECTION.TRANSACTION}${splitTransactionID}`);
+        expect(createdTransaction).toBeDefined();
+        expect(createdTransaction?.transactionID).toBe(splitTransactionID);
+        expect(createdTransaction?.comment?.comment).toBe(testComment);
+        expect(createdTransaction?.category).toBe(testCategory);
+        expect(createdTransaction?.currency).toBe(testCurrency);
+        expect(createdTransaction?.merchant).toBe(CONST.TRANSACTION.PARTIAL_TRANSACTION_MERCHANT);
+        expect(createdTransaction?.reportID).toBe(CONST.REPORT.SPLIT_REPORT_ID);
+    });
+
+    it('should update NVP_QUICK_ACTION_GLOBAL_CREATE with SPLIT_SCAN action', async () => {
+        // Given an existing quick action
+        const policyID = 'B';
+        const existingQuickAction = {
+            action: CONST.QUICK_ACTIONS.REQUEST_MANUAL,
+            chatReportID: '12345',
+        };
+
+        await Onyx.merge(ONYXKEYS.NVP_QUICK_ACTION_GLOBAL_CREATE, existingQuickAction);
+
+        const participants: IOUParticipant[] = [{isPolicyExpenseChat: true, policyID, accountID: RORY_ACCOUNT_ID}];
+        const participantsPolicyTags = await getParticipantsPolicyTags(participants);
+
+        // When starting a split bill
+        const {splitTransactionID} = startSplitBill({
+            participants,
+            currentUserLogin: currentUserPersonalDetails.login ?? '',
+            currentUserAccountID: currentUserPersonalDetails.accountID,
+            comment: '',
+            receipt: {},
+            category: '',
+            tag: '',
+            currency: CONST.CURRENCY.USD,
+            taxCode: '',
+            taxAmount: 0,
+            quickAction: existingQuickAction,
+            policyRecentlyUsedCurrencies: [],
+            policyRecentlyUsedTags: undefined,
+            participantsPolicyTags,
+        });
+
+        await waitForBatchedUpdates();
+
+        expect(splitTransactionID).toBeDefined();
+
+        // Then NVP_QUICK_ACTION_GLOBAL_CREATE should be updated with SPLIT_SCAN action
+        const quickAction = await getOnyxValue(ONYXKEYS.NVP_QUICK_ACTION_GLOBAL_CREATE);
+        expect(quickAction?.action).toBe(CONST.QUICK_ACTIONS.SPLIT_SCAN);
+        expect(quickAction?.chatReportID).toBeDefined();
+        expect(quickAction?.isFirstQuickAction).toBe(false);
+    });
 });
 
 describe('updateSplitTransactionsFromSplitExpensesFlow', () => {