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Looks like Uber will have to start charging VAT

https://www.bailii.org/ew/cases/EWHC/Admin/2021/3290.html

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By ireallyshouldknowthisbut
06th Dec 2021 18:31

About time

I wonder if delivery drivers will also be employees too.

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Replying to ireallyshouldknowthisbut:
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By AndyC555
07th Dec 2021 07:18

"About time"

Why would any passenger want 20% added to their fare?

"I wonder if delivery drivers will also be employees too."

Also? The Uber case determined that drivers were 'workers' not 'employees'.

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By rmillaree
07th Dec 2021 09:21

"Why would any passenger want 20% added to their fare?"

Its about providing a proper level playing field - absolutely ridiculous uber not charging vat when uk based competitors must charge vat. HMRC should have done the necessary years ago so that Uber could not take the micky as they have done.

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By DJKL
07th Dec 2021 09:28

The workers not employees point is stated at the outset, it is more the point regarding who the contract is with, and the 1998 legislation which regulates the licensing of those plying for hire in London ,that appear to be the focus.

Unfair competition appears to be the rationale of the other taxi operatives pushing for the action and they have used the 1998 regulations re licensing of London Taxis as their weapon of choice, asking effectively who is taking the booking.

At the end of the day we want all business entities to pay the correct tax because if not the rest of us end up either paying more tax or get a poorer services, it is nothing to do with individuals wanting to pay 20% but is instead trying to ensure that one business does not obtain an unfair advantage by employing practices that are not correct.

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Replying to AndyC555:
By ireallyshouldknowthisbut
07th Dec 2021 10:20

AndyC555 wrote:

"About time"

Why would any passenger want 20% added to their fare?

"I wonder if delivery drivers will also be employees too."

Also? The Uber case determined that drivers were 'workers' not 'employees'.

As above, why should uber be exempt from VAT? They are a huge business, and its unfair competition.

As for the employees being taxes as employees, this would seem sensible to me. Having a large % of the workforce in precarious make believe 'self employment' is not good for anyone. Its certainly no good for the exploited workers who has then no recourse to minimum wage. And its not much good for society in a wider scale. I can understand why so few test for Covid if it risks 2 weeks unpaid off work, as just on example.

It also tends to usher in draconian measures onto the real self employed and to treat them more like employees with I don't know a new system for quarterly tax payments and more regular record keeping. Remember his is where MTD is coming from, HMRC think most self employed are really just employees by another name. And to be fair to HMRC a big chunk are - but probably not the chunk that have an accountant, or indeed file any tax returns.

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Replying to ireallyshouldknowthisbut:
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By More unearned luck
07th Dec 2021 11:49

"As for the employees being taxes as employees, this would seem sensible to me."

Indeed it is, the difficulty is in deciding which side of the employee/SE divide a worker is. The spate of IR35 cases over the last couple of years shows just how difficult that can be.

But I think that your real point is that limb b workers should be deemed to be employees for all purposes (including tax & NIC), but that would merely redraw the line; there would still be the difficulty of deciding which side of it a case fell.

The real solution, for which the political will does not exist, is that employees (and their employers) and the self-employed to have the same tax and NIC burden. That would relieve much of the pressure on engagers to classify an engagement as a contract for services.

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By richard thomas
07th Dec 2021 21:29

"Workers" are entitled to minimum wage - ss 1 & 54(3) National Minimum Wage Act 1998.

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Jason Croke
By Jason Croke
07th Dec 2021 11:19

It's alright, HMRC like to do sweet heart deals with the big boys, GE only had to pay 10% of their recent multi-billion liability and I'm sure Uber will bung HMRC a few million quid and job done.

Meanwhile, SME taxpayer reclaimed £37.50 VAT on a night out he had with a potential client and disallowed under business entertaining rules and full force of HMRC's power will be felt, 30% penalties, etc.

As for Uber, it was always a taxi business, it's downfall was bringing their business model to the EU....might work in the USA where employment and taxation laws are slacker than the EU where employment and taxation laws are more clearly defined (generally).

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By The Dullard
07th Dec 2021 22:23

There remains a difference between providing "the journey" as principal and a supply of transportation services. The fact remains that Uber don't actually have an vehicles in which to transport people. The same applies to the employee or self-employed "worker" issue IMO.

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