The VAT thing is added to the article almost as a throwaway, but it's huge. At the moment Uber says the drivers are responsible for collecting any VAT from passengers and passing this on to HMRC....
The VAT thing is added to the article almost as a throwaway, but it's huge.
At the moment Uber says the drivers are responsible for collecting any VAT from passengers and passing this on to HMRC. Most drivers weren't registered for VAT because you only have to register for VAT if you have a vat taxable turnover more than £85,000 per year.
This change means Uber now becomes responsible for collecting VAT from passengers, for every single journey, and passing it to HMRC.
If I understand that correctly, this means a huge boost to tax revenue right? All the tax that should have been collected be drivers but wasn't, will now be paid by Uber?
If I understand that correctly, this means a huge boost to tax revenue right? All the tax that should have been collected be drivers but wasn't, will now be paid by Uber?
"Huge" is relative, according to the Mirror Uber takes in around 80 million pounds revenue/year. VAT is 20%, so that's around 16 million pounds per year. That's a lot, but a rounding error on...
The probable outcome will be that Uber prices will go up a bit, and drivers or Uber will make a bit less. This will make taxi drivers (who I presume already charge VAT?) more competitive.
The VAT thing is added to the article almost as a throwaway, but it's huge.
At the moment Uber says the drivers are responsible for collecting any VAT from passengers and passing this on to HMRC. Most drivers weren't registered for VAT because you only have to register for VAT if you have a vat taxable turnover more than £85,000 per year.
This change means Uber now becomes responsible for collecting VAT from passengers, for every single journey, and passing it to HMRC.
If I understand that correctly, this means a huge boost to tax revenue right? All the tax that should have been collected be drivers but wasn't, will now be paid by Uber?
"Huge" is relative, according to the Mirror Uber takes in around 80 million pounds revenue/year. VAT is 20%, so that's around 16 million pounds per year. That's a lot, but a rounding error on total VAT revenue or total tax revenue.
The probable outcome will be that Uber prices will go up a bit, and drivers or Uber will make a bit less. This will make taxi drivers (who I presume already charge VAT?) more competitive.