Uber faces new pressure from crowdfunded VAT case

Sussex · **Posted:** Mon Jul 03, 2017 8:38 pm

grandad wrote:

How do you see this scenario then.
1. A hackney only company acting as an agent for several drivers takes bookings on their behalf. The customers all pay cash to the drivers, nome of whom have a large enough turnover to be VAT registered. does anyone have to account for vat on the fares?

No because the hackney only (although it could be a mixed fleet IMO) is not taking a cut.

This judgement sets out the law, as it was then, and still is as far as I'm aware.

viewtopic.php?f=13&t=11072

Sussex · **Posted:** Mon Jul 03, 2017 8:41 pm

grandad wrote:

2. the same Hackney only company acting as agent for the same drivers but this time the customers want to pay in advance using a credit/debit card collected at the point of booking by the office. The driver still receives 100% of the fare. Does anyone have to account for VAT on the fares?

Not so clear cut.

But if I were a lawyer I think I could make a good case that the firm is acting as an agent for the driver, thus no VAT.

grandad · **Joined:** Tue Apr 03, 2007 11:27 pm **Posts:** 20130

Sussex wrote:

grandad wrote:

2. the same Hackney only company acting as agent for the same drivers but this time the customers want to pay in advance using a credit/debit card collected at the point of booking by the office. The driver still receives 100% of the fare. Does anyone have to account for VAT on the fares?

Not so clear cut.

But if I were a lawyer I think I could make a good case that the firm is acting as an agent for the driver, thus no VAT.

I think it is clear cut. It is in the VAT guide for taxi and private hire.
Now if it is a Private Hire company doing exactly the same thing is VAT accounted for any differently?

MR T · **Joined:** Thu Sep 07, 2006 8:26 pm **Posts:** 8529

grandad wrote:

Sussex wrote:

grandad wrote:

2. the same Hackney only company acting as agent for the same drivers but this time the customers want to pay in advance using a credit/debit card collected at the point of booking by the office. The driver still receives 100% of the fare. Does anyone have to account for VAT on the fares?

Not so clear cut.

But if I were a lawyer I think I could make a good case that the firm is acting as an agent for the driver, thus no VAT.

I think it is clear cut. It is in the VAT guide for taxi and private hire.
Now if it is a Private Hire company doing exactly the same thing is VAT accounted for any differently?

3.6 Agent for cash work and principal for account work
You may, depending again on the terms of any written or oral contract between you and the drivers and the actual working practices of your business, be acting as an agent for the drivers for the cash work they perform (see paragraph 3.4), and as a principal for the work done for account customers (see paragraph 3.2). But, if you’re to account for VAT on this basis you must be able to satisfy us that:
the arrangements are reflected in the terms agreed with your drivers
there is a genuine difference in the operation of the cash and account sides of your business

Uber only work one way.

grandad · **Joined:** Tue Apr 03, 2007 11:27 pm **Posts:** 20130

MR T wrote:

3.6 Agent for cash work and principal for account work
You may, depending again on the terms of any written or oral contract between you and the drivers and the actual working practices of your business, be acting as an agent for the drivers for the cash work they perform (see paragraph 3.4), and as a principal for the work done for account customers (see paragraph 3.2). But, if you’re to account for VAT on this basis you must be able to satisfy us that:
the arrangements are reflected in the terms agreed with your drivers
there is a genuine difference in the operation of the cash and account sides of your business

Uber only work one way.

You can be a principle for account and cash work.
You can be an agent for account and cash work.
You can be a principle for account work and an agent for cash work.
As it says "depending on the terms of any written or oral contract between you and the drivers etc.

MR T · **Joined:** Thu Sep 07, 2006 8:26 pm **Posts:** 8529

grandad wrote:

MR T wrote:

3.6 Agent for cash work and principal for account work
You may, depending again on the terms of any written or oral contract between you and the drivers and the actual working practices of your business, be acting as an agent for the drivers for the cash work they perform (see paragraph 3.4), and as a principal for the work done for account customers (see paragraph 3.2). But, if you’re to account for VAT on this basis you must be able to satisfy us that:
the arrangements are reflected in the terms agreed with your drivers
there is a genuine difference in the operation of the cash and account sides of your business

Uber only work one way.

You can be a principle for account and cash work.
You can be an agent for account and cash work.
You can be a principle for account work and an agent for cash work.
As it says "depending on the terms of any written or oral contract between you and the drivers etc.

Quote:

there is a genuine difference in the operation of the cash and account sides of your business

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Uber faces new pressure from crowdfunded VAT case

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