"Are you permitted to use the phone here?"
Translation:Czy tu wolno używać telefonu?
"tu można" you use when you want to say "yes you can" " tu można skorzystać z telefonu, "można tu" you rather use in question "czy można tu skorzystać z telefonu?"
While I do agree that the sequence "Czy można tu..." sounds more natural (come to think about it...), I would never find forming it "Czy tu można..." even a tiny bit odd.
Isn't it better to have the English sentence "Can I use the phone here?". Otherwise, the way I understand "Are you permitted to use the phone here?" is in Polish as "Czy masz pozwolenie, aby używać tutaj telefonu?". Something that would be asked by a stranger to someone who's already on the phone in a phone-free zone.
Your version is accepted.
Well, the sentence is here to teach the totally impersonal "wolno". The closest translation is "Can one"... but it is not really used that often as "Can you". So we are sometimes using "Can one" and sometimes the (possibly quite impersonal as well) "Can you" to show how the Polish phrase is used.
Officially correct answer (Nov. 2018): "Czy tu wolno używać telefonu?"
Marked as incorrect, although also correct: "Czy wolno tu używać telefonu?" (reported)
Not checked, but also correct: "Czy wolno używać tu telefonu?"
"Tu" is very flexible here. And instead of "tu" also "tutaj" should be accepted in all of those positions.