Taxi Driver Online :: View topic - Uber v HMRC. An interesting VAT battle

one reason I have mostly owner drivers I can't be bothered with the hassle of going over the vat threshold :wink:

I suspect that Uber's clout with the government and judiciary will see them win this one :sad:

I have to account for VAT on the money that the drivers pay to the company which is the same as the money UBER receive out of the fare that the customers pay. As I see it, at the very least UBER should be accounting for VAT on the percentage that they get because they have an income in excess of the £85,000 threshold.
Lets put it this way, if UBER win this then I will be claiming back a whole lot of VAT.

grandad wrote:

It's not the same, well not quite.

I suspect Uber pay tax/VAT on the 25% commission, but the way VAT laws have developed over time is that VAT is due on all the money Uber receive from the punters, not just the 25% they keep.

In the same way as if I buy a Mars Bar from the corner shop, VAT is payable on the total price, not just the difference between the price I pay and the price the shopkeeper paid.

Author:	Sussex [ Sun May 19, 2019 8:55 pm ]
Post subject:	Uber v HMRC. An interesting VAT battle
Uber customers could face higher fares over claim the ride-hailing app owes more than £1BILLION in unpaid VAT Ride-booking app Uber is under investigation by HM Revenue & Customs because it allegedly owes more than £1billion in unpaid tax. If the company, which has more than 60,000 drivers in Britain, is made to pay out then its users will potentially face a rapid increase in fares. Uber doesn't pay VAT on its fares, because it claims it acts as a 'middleman' between self-employed drivers and customers. However, the description Uber gives of its relationship with its drivers has been called out by judges for involving a 'high degree of fiction' when in December last year two of its drivers won a case for being classed as 'workers' who deserved minimum wage and paid holiday. The company argues that it shouldn't have to pay the standard amount of tax because its drivers earn less than £85,000 a year - the threshold at which it starts being charged. If the HMRC rules that the company is in fact a transportation company and should therefore be paying VAT, Uber will face the largest tax bill ever levied on a digital giant in the UK. The HMRC is believed to be currently undecided in their investigation. Tax barrister Jolyon Maugham QC is due to file a legal action against the HMRC in High Court this week because he believes it has mishandled Uber's VAT case. He estimates that Uber's potential VAT bill will be £260m a year, with taxmen able to claim four years back payment. Uber, founded in San Francisco in 2009 and now operating in 600 cities across 65 countries, has been hit by countless controversies in the past. In 2014 it was hit by the 'God view' scandal - which saw the company's ex-forensic investigator admit that employees regularly spied on politicians, celebrities and even ex-lovers by using the app's map system. Former Uber engineer Susan Fowler spoke out in 2017 about claims of sexual harassment and discrimination - leading to speculation about widespread mistreatment of women in Silicon Valley. Travis Kalanick - former CEO who was forced to step down in 2017 - was caught on camera arguing with his own Uber driver who was complaining about the difficulties of working for the company. According to the Guardian, he said: 'Some people don’t like to take responsibility for their own [edited by admin]. They blame everything in their life on somebody else. Good luck!' Kalanick later apologised for his outburst. Three months later Kalanick was forced to formally step down after a group of investors wrote a letter demanding his departure. According to the Sunday Times, Uber said: 'Uber fulfils and will continue to fulfil its tax obligations in the countries in which it operates.' An HMRC spokesman said: 'HMRC will always make sure that every business, no matter its size, pays all the taxes due under UK law and we don't settle for less. HMRC's ability to assess for tax will always depend on the specific facts and circumstances of any case.'

Author:	grandad [ Mon May 20, 2019 6:40 am ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
I have to account for VAT on the money that the drivers pay to the company which is the same as the money UBER receive out of the fare that the customers pay. As I see it, at the very least UBER should be accounting for VAT on the percentage that they get because they have an income in excess of the £85,000 threshold. Lets put it this way, if UBER win this then I will be claiming back a whole lot of VAT.

Author:	edders23 [ Mon May 20, 2019 11:15 am ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
one reason I have mostly owner drivers I can't be bothered with the hassle of going over the vat threshold I suspect that Uber's clout with the government and judiciary will see them win this one

Author:	heathcote [ Mon May 20, 2019 11:51 am ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
edders23 wrote: one reason I have mostly owner drivers I can't be bothered with the hassle of going over the vat threshold I suspect that Uber's clout with the government and judiciary will see them win this one Doubt it.

Author:	rayggb [ Mon May 20, 2019 4:05 pm ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
Poober seem to have friends in high places so I wouldn't put money on them getting exactly what they want!

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Author:	Sussex [ Mon May 20, 2019 10:01 pm ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
grandad wrote: I have to account for VAT on the money that the drivers pay to the company which is the same as the money UBER receive out of the fare that the customers pay. As I see it, at the very least UBER should be accounting for VAT on the percentage that they get because they have an income in excess of the £85,000 threshold. Lets put it this way, if UBER win this then I will be claiming back a whole lot of VAT. It's not the same, well not quite. I suspect Uber pay tax/VAT on the 25% commission, but the way VAT laws have developed over time is that VAT is due on all the money Uber receive from the punters, not just the 25% they keep. In the same way as if I buy a Mars Bar from the corner shop, VAT is payable on the total price, not just the difference between the price I pay and the price the shopkeeper paid.

Author:	StuartW [ Mon May 20, 2019 10:03 pm ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
As I recall it there are two main aspects to this, one of which isn't mentioned in the article. Uber doesn't charge VAT on the fees it charges drivers because it charges them via a Dutch subsidiary, thus no VAT chargeable under EU law. That's where it differs from a standard UK despatch operation, and indeed other app-based platforms in the UK. The other dimension relates to the relationship between the platform and the drivers, as outlined in the article, and while I'm not sure if the VAT arguments are precisely the same as whether the drivers are employees or self-employed, there does seem to be a big overlap. And, of course, to that degree the argument applies equally to other app-based platforms and more traditional UK operations So there are two elephants in the room as regards that article - first, that Uber is different in that it charges drivers via a Dutch subsidiary. The second is that the employee/self-employed issue is also applicable to other UK operations, and to that degree the VAT issue is the same.

Author:	edders23 [ Tue May 21, 2019 10:48 am ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
the same with Google and charging uk businesses through their irish subsidiary that ought to change VAT should be liable in the country the services were provided

Author:	MR T [ Tue May 21, 2019 5:50 pm ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
Sussex wrote: grandad wrote: I have to account for VAT on the money that the drivers pay to the company which is the same as the money UBER receive out of the fare that the customers pay. As I see it, at the very least UBER should be accounting for VAT on the percentage that they get because they have an income in excess of the £85,000 threshold. Lets put it this way, if UBER win this then I will be claiming back a whole lot of VAT. It's not the same, well not quite. I suspect Uber pay tax/VAT on the 25% commission, but the way VAT laws have developed over time is that VAT is due on all the money Uber receive from the punters, not just the 25% they keep. In the same way as if I buy a Mars Bar from the corner shop, VAT is payable on the total price, not just the difference between the price I pay and the price the shopkeeper paid. Your wrong

Author:	Sussex [ Tue May 21, 2019 7:55 pm ]
Post subject:	Re: Uber v HMRC. An interesting VAT battle
Quote: Your wrong Well I look forward to the outcome should HMRC act against Uber.

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