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Old June 3rd 19, 02:07 PM posted to uk.transport.london
JNugent[_5_] JNugent[_5_] is offline
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Posts: 338
Default Uber and the VAT man

On 03/06/2019 11:49, Roland Perry wrote:
In message , at 13:56:23 on Sun, 2 Jun
2019, JNugent remarked:

I don't know what form their subsequent internal accounting
proceduresÂ* take, but if it were their practice to issue invoices to
the driver, IÂ* strongly suspect that we would have heard about that
by now.
Â*Therefore you are now agreeing with my proposition that they pay the
driver only part of what they collected from the passenger. Having
deducted their commission.


Not in the slightest.

They do pay an amount to the driver. Whether that is a fixed
proportion or a flat fee based on time or mileage is more than I know.
I cannot agree that Uber pay the whole of the fare less their (Uber's)
commission to the driver for the rather obvious reason that I do not
know it to be true.


Even though you've been given plausible citations which say it is true?


Lots of incompatible things might be plausible.

"Plausible" does not mean the same as "definitive".

Whether they pay it "on the spot", or perhaps 'at the end of the
week'Â* or whatever, is peripheral to that particular aspect.


Is it? If you say so. I'm not convinced.


Even though you've been given plausible citations which say it is true?


See above.

The word "plausible" used to be a weasel word attached to con-men and spivs.
Â*There are two models possible:
Â* Â* Passenger pays for the ride and the whole fare is collected by Uber
Â*Â* and sent to the driver (with Uber being in effect just a form of
Â*Â* merchant services dealing with the card payment). Later, Uber sends a
Â*Â* bill to the driver for his usage of their booking/billing platform.
Â*Or,
Â* Â* Passenger pays Uber for the ride, and they send him (maybe
Â*Â* immediately, maybe later) a piecework payment for having done the
Â*Â* driving aspect.


True enough. In either csae, Uber turns over the whole of the fare.


Now you are just being perverse. Paying the driver piece-work (if that
were the model) is absolutely not handing over the whole fare.


I realised too late that "turns over" might be misinterpreted (whether
inadvertently or mischievously) as "handed over".

I mean that all of the money taken from the CC account of the hirer is
turned over (meaning simply "taken" or "collected") by Uber.

I hope that's clearer.

TheTrainline, does the train company get paid for the ticket
straight away, or does TTL have 30day (or whatever) credit with
them all. Whatever the answer, their turnover in their published
accounts is just the commission/fee element.

But they are not Uber. And Uber are going to have to argue that the
money they turn over is not part of their turnover.
Â*The two business models are very similar.


Not at all. Does Trainline get 100% of the turnover of the TOCs
running through its accounts?


Through its bank accounts - yes. Through its trading accounts - no.


Rubbish.

That could not be true unless trainline.com were the only way of buying
a railway ticket. And it isn't.

Uber certainly gets 100% of its own turnover passing through its books.


But the question is: what of the turnover of its drivers passing though
its "books", whatever the latter is supposed to mean.


That's a matter to be decided by HMRC and/or the courts.

Just to be clear about this: if an individual self-employed
taxi-driver (or private hire driver) turned over £85,000 and were
honest enough to report the fact, they would be forced by law to
register for VAT and to charge it on top of the fare.

But turning over £1808 a week (assuming five weeks' non-activity per
annum) would be a tall order. Not so for Uber.
Â*Yes, I think we all understand why the £85k is important.


Uber have to collect and pay VAT (this is not automatically so for
other private hire drivers, proprietors or operators). The question is
only the quantum of their turnover.


Indeed. Is it just the commission, or also the drivers' pay.


Indeed. That is the question which has to be decided by an official body
(probably the Court of Appeal, in the end).