VAT News

HMRC Opens Investigation into Uber Over £1bn Unpaid VAT

The technology giant is never far from the headlines, albeit good and bad. After surviving several scares in the UK; being 'banned' from operating in London and mass black-cab protests to name a few, but this weeks news maybe it's most damaging.

HMRC has opened an investigation into Uber over allegations it owes around £1bn in unpaid VAT. The investigations have arisen regarding Uber's claim it is exempt from paying VAT because their drivers are considered self-employed, combined with the fact their earnings fall below the £85,000 threshold. ​HMRC is now looking into the validity of these claims, and whether Uber can be instead classified as a transportation company, and should, therefore, be liable to pay the levy.

Uber, which has more than 60,000 drivers in the UK, does not pay any VAT on fares because the company says it is just a middleman between its self-employed drivers and passengers. How Uber's drivers are classified has been an on-going headache for Uber for a number of years. In 2018, the Court of Appeal agreed with an employment tribunal decision that its drivers were in fact directly employed by the firm, and therefore entitled to minimum wage, sick pay and also holiday pay.


Related articles

HMRC: No VAT on e-Publications for UK Citizens as of 1 May 2020

HMRC has scrapped VAT completely off e-books and e-publications from 20% down to 0%. In an effort to make reading more accessible for the UK public while in self-isolation due to the Coronavirus, HMRC fast-tracked the motion and implemented it seven months ahead of schedule. 

Read more
COVID-19 VAT tips for businesses

These COVID-19 VAT tips for businesses will help companies around the world boost liquidity in times of economic challenges. Learn how to harness VAT refunds and compliance.

Read more
COVID-19 VAT Cashflow Tips (Part Two)

COVID-19 is affecting business in ways no one thought possible. In order to free yourself from the burden of cashflow worry, we’re trying to do our bit to advice you on ways you can inject income into your bottom line.

Read more