In message , at 14:29:00 on Tue, 21 May
2019, Recliner remarked:

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

The question is what service Uber is providing to the passengers: a taxi
service or a booking service.

I don't think the passengers get an itemised bill breaking out those two
components.

Similarly, does it employ the drivers, or just provide a booking
service for them?

That's famously something being looked a very closely for employment law
reasons.

The question which then arises is "if they are employees, is the
passenger's bill entirely from Uber, and if so where's the VAT, given
Uber itself turns over more than £85k per annum".
--
Roland Perry

Roland Perry wrote:
In message , at 14:29:00 on Tue, 21 May
2019, Recliner remarked:

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

The question is what service Uber is providing to the passengers: a taxi
service or a booking service.

I don't think the passengers get an itemised bill breaking out those two
components.

Similarly, does it employ the drivers, or just provide a booking
service for them?

That's famously something being looked a very closely for employment law
reasons.

The question which then arises is "if they are employees, is the
passenger's bill entirely from Uber, and if so where's the VAT, given
Uber itself turns over more than £85k per annum".

Exactly. And that's why Uber may have a billion pound back tax bill.

On 21/05/2019 13:40, Roland Perry wrote:
In message , at 12:48:07 on Tue, 21
May 2019, JNugent remarked:
Would it mitigate that (a little anyway) if Uber decided to base
itself
in Luxembourg like some other online platforms do?

I think they still have to charge and pay UK VAT for trade services in
the UK. Even Uber can't claim they're delivering the service in
Luxembourg. If you, as a private individual, buy something mail order
from Luxembourg, they have to charge you VAT; only if you provide a
VAT number do they not have to do so.

It seems that there was a rule change in Jan 2015 which essentially
blocked the Luxembourg-loophole for VAT.
Â*Presumably though the service is provided by the driver and is
un-VATable (unless they earn more than £85k or whatever), but the
service provided by the platform (ie the server) could actually be
abroad and hence charged at their VAT rate?Â* As the service of
matchingÂ* user to platform doesn't result in any physical delivery of
product thenÂ* it could legitimately be said to happen offshore.Â* (I'm
not a VATÂ* expert, but I gueess this is the sort of thing they are
basing it off).

With Uber (which I have used only twice, neither time in the UK), the
charges are payable to Uber. If UK VAT applies to their charges in the
UK, it will have to be paid to Uber, presumably at 20% of the charge.
How Uber divide up the charge (ex-VAT) is up to them, but all of it
will be liable to the tax if any of it is.

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

That's taxi-driving for you.

With Uber, the charge is not paid to the driver (and the drivers are not
taxi-drivers just as the cars are not taxis). The rider's sole contract
is with Uber itself. And they turn over more than £85,000 pa.

On 21/05/2019 16:42, Recliner wrote:
Roland Perry wrote:
In message , at 14:29:00 on Tue, 21 May
2019, Recliner remarked:

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

The question is what service Uber is providing to the passengers: a taxi
service or a booking service.

I don't think the passengers get an itemised bill breaking out those two
components.

Similarly, does it employ the drivers, or just provide a booking
service for them?

That's famously something being looked a very closely for employment law
reasons.

The question which then arises is "if they are employees, is the
passenger's bill entirely from Uber, and if so where's the VAT, given
Uber itself turns over more than £85k per annum".

Exactly. And that's why Uber may have a billion pound back tax bill.

Quite right too.

They can't have it both ways, having the exclusive billing contract with
the customer *and* not turning over £85,000 pa.

In message , at 15:42:17 on Tue, 21 May
2019, Recliner remarked:
Roland Perry wrote:
In message , at 14:29:00 on Tue, 21 May
2019, Recliner remarked:

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

The question is what service Uber is providing to the passengers: a taxi
service or a booking service.

I don't think the passengers get an itemised bill breaking out those two
components.

Similarly, does it employ the drivers, or just provide a booking
service for them?

That's famously something being looked a very closely for employment law
reasons.

The question which then arises is "if they are employees, is the
passenger's bill entirely from Uber, and if so where's the VAT, given
Uber itself turns over more than £85k per annum".

Exactly. And that's why Uber may have a billion pound back tax bill.

Potentially?
--
Roland Perry

In message , at 17:00:44 on Tue, 21
May 2019, JNugent remarked:

With Uber (which I have used only twice, neither time in the UK),
the charges are payable to Uber. If UK VAT applies to their charges
in the UK, it will have to be paid to Uber, presumably at 20% of the
charge. How Uber divide up the charge (ex-VAT) is up to them, but
all of it will be liable to the tax if any of it is.

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

That's taxi-driving for you.

With Uber, the charge is not paid to the driver (and the drivers are
not taxi-drivers just as the cars are not taxis). The rider's sole
contract is with Uber itself.

Unless Uber is an agency and you are booking with the successfully
bidding driver, and as part of the agency agreement Uber pass your money
to them. Separately charging the driver a commission.

And they turn over more than £85,000 pa.

Yes, that's one of the main ingredients.
--
Roland Perry

Roland Perry wrote:
In message , at 17:00:44 on Tue, 21
May 2019, JNugent remarked:

With Uber (which I have used only twice, neither time in the UK),
the charges are payable to Uber. If UK VAT applies to their charges
in the UK, it will have to be paid to Uber, presumably at 20% of the
charge. How Uber divide up the charge (ex-VAT) is up to them, but
all of it will be liable to the tax if any of it is.

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

That's taxi-driving for you.

With Uber, the charge is not paid to the driver (and the drivers are
not taxi-drivers just as the cars are not taxis). The rider's sole
contract is with Uber itself.

Unless Uber is an agency and you are booking with the successfully
bidding driver, and as part of the agency agreement Uber pass your money
to them. Separately charging the driver a commission.

These arguments usually come down to how much independence the supposedly
self-employed drivers have, and the answer usually is, "very little". Uber
enforces standards, which of course helps the customers, but means that the
drivers have very little freedom. For example, you talked about
"successfully bidding drivers", which suggests that they have the right to
set their own prices, but they don't.

On 21/05/2019 18:01, Roland Perry wrote:
In message , at 17:00:44 on Tue, 21
May 2019, JNugent remarked:

With Uber (which I have used only twice, neither time in the UK),
theÂ* charges are payable to Uber. If UK VAT applies to their charges
in theÂ* UK, it will have to be paid to Uber, presumably at 20% of
the charge.Â* How Uber divide up the charge (ex-VAT) is up to them,
but all of itÂ* will be liable to the tax if any of it is.

Â*The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

That's taxi-driving for you.

With Uber, the charge is not paid to the driver (and the drivers are
not taxi-drivers just as the cars are not taxis). The rider's sole
contract is with Uber itself.

Unless Uber is an agency and you are booking with the successfully
bidding driver, and as part of the agency agreement Uber pass your money
to them. Separately charging the driver a commission.

You have more or less described what we might call a "traditional
minicab" (traditional since 1960, that is). The driver gets paid by the
passenger and the driver pays a commission or radio circuit rent to the
operator. The operator's turnover consists of the aggregate of the radio
rent commissions paid to them by the drivers.

But it definitely isn't what happens with Uber. There, the passenger
pays Uber, and Uber pays a part of the charge to the driver. It's 180
degrees the other way round from the Welbeck Minicab model.

*All* of the money is therefore part of Uber's turnover. And that's
before a penny of it reaches the driver, the driver merely being one of
Uber's overheads.

And they turn over more than £85,000 pa.

Yes, that's one of the main ingredients.

On 22/05/2019 00:33, JNugent wrote:
[snip]

*All* of the money is therefore part of Uber's turnover. And that's
before a penny of it reaches the driver, the driver merely being one of
Uber's overheads.

Which is why, among other reasons, that if I ever do use a taxi (rare,
except in emergencies) I will only ever use a black cab.


--
Ria in Aberdeen

[Send address is invalid, use sipsoup at gmail dot com to reply direct]

In message , at 22:44:27 on Tue, 21 May
2019, Recliner remarked:
Roland Perry wrote:
In message , at 17:00:44 on Tue, 21
May 2019, JNugent remarked:

With Uber (which I have used only twice, neither time in the UK),
the charges are payable to Uber. If UK VAT applies to their charges
in the UK, it will have to be paid to Uber, presumably at 20% of the
charge. How Uber divide up the charge (ex-VAT) is up to them, but
all of it will be liable to the tax if any of it is.

The theory is that with taxi drivers below the £85k VAT limit, they
can't charge their riders VAT.

That's taxi-driving for you.

With Uber, the charge is not paid to the driver (and the drivers are
not taxi-drivers just as the cars are not taxis). The rider's sole
contract is with Uber itself.

Unless Uber is an agency and you are booking with the successfully
bidding driver, and as part of the agency agreement Uber pass your money
to them. Separately charging the driver a commission.

These arguments usually come down to how much independence the supposedly
self-employed drivers have, and the answer usually is, "very little". Uber
enforces standards, which of course helps the customers, but means that the
drivers have very little freedom. For example, you talked about
"successfully bidding drivers", which suggests that they have the right to
set their own prices, but they don't.

They set their own availability (ie bid for doing a job they like the
look of, rather than one they don't), though. Which while I agree Uber's
drivers overall feel much more like employees than freelance
contractors, is one of the infamous tests.

Another is providing your own equipment, which I think Uber drivers do,
and also being able to substotute another worker. I'm unsighted as to
what Uber thinks about a driver "loaning" his account to a friend, who
acts as driver for the day, is.
--
Roland Perry