Discussion
johnfm said:
Surely ONLY if you are registered for VAT.
You cannot issue a VAT receipt and collect VAT if you're not registered to do so.
My point is surely the 'correct' procedure is to notify HMRC.
Jolyon has an invoice (with no VAT) for his expenses. He hasn't paid any VAT to reclaim in his VAT return.
Does the court have standing to intervene at all in a matter between Uber and HMRC? There is no matter to determine between Uber and Jolyon, as they are not VAT registered so have no obligation to issue him a VAT receipt.
I have no idea at all of the mechanism by which Jolyon and his representatives expect to be able to turn that defence: "Uber isn't VAT registered and there is, therefore, no VAT receipt" into a broader discussion about whether or not Uber should be VAT registered and what options the HC has to hear those discussions, or to produce any substantive judgment as a result.You cannot issue a VAT receipt and collect VAT if you're not registered to do so.
My point is surely the 'correct' procedure is to notify HMRC.
Jolyon has an invoice (with no VAT) for his expenses. He hasn't paid any VAT to reclaim in his VAT return.
Does the court have standing to intervene at all in a matter between Uber and HMRC? There is no matter to determine between Uber and Jolyon, as they are not VAT registered so have no obligation to issue him a VAT receipt.
But that seems to be the intention
There are some parallels between the Aussie case and this one, as well as some differences.
For anyone so inclined, the judgment in that case is here
http://www.judgments.fedcourt.gov.au/judgments/Jud...
The likely outcome is that all Uber drivers in Aus are to register for GST.
For anyone so inclined, the judgment in that case is here
http://www.judgments.fedcourt.gov.au/judgments/Jud...
The likely outcome is that all Uber drivers in Aus are to register for GST.
If you look at the parties involved in bringing the case, Jolyon Maugham QC, represented by Edwin Coe LLP with Opinion provided by George Peretz QC and Brendan McGurk
They are people and firms that know about VAT. That much is not in any doubt.
Until the case is heard, we aren't going to find out more than we know already, but I think it is a reasonable assumption that they have thought this through and do have a plan that is designed to cause the HC to nudge the question 'should uber be VAT registered?' Somewhere nearer to being addressed than it appears to be now.
There obviously has to be more to that plan than
"Give me a VAT receipt
The service provider is not & does not need to be VAT registered
OK, thanks for coming"
But I don't know what it is. I look forward to finding out and seeing how it unfolds.
Whilst the Emp Trib isn't directly translatable to VAT matters (& is subject to appeal), it did rule that Uber is the service provider, not the driver population.
My only dog in the fight is a donation to the crowd justice campaign.
I like the Uber model and technology in principal and, if it plays by the rules, I wish it great success. If it's success is built on an artificial price advantage attributable to an incorrect treatment of the business by HMRC, then that needs to be corrected one way or another.
They are people and firms that know about VAT. That much is not in any doubt.
Until the case is heard, we aren't going to find out more than we know already, but I think it is a reasonable assumption that they have thought this through and do have a plan that is designed to cause the HC to nudge the question 'should uber be VAT registered?' Somewhere nearer to being addressed than it appears to be now.
There obviously has to be more to that plan than
"Give me a VAT receipt
The service provider is not & does not need to be VAT registered
OK, thanks for coming"
But I don't know what it is. I look forward to finding out and seeing how it unfolds.
Whilst the Emp Trib isn't directly translatable to VAT matters (& is subject to appeal), it did rule that Uber is the service provider, not the driver population.
My only dog in the fight is a donation to the crowd justice campaign.
I like the Uber model and technology in principal and, if it plays by the rules, I wish it great success. If it's success is built on an artificial price advantage attributable to an incorrect treatment of the business by HMRC, then that needs to be corrected one way or another.
Edited by anonymous-user on Tuesday 4th April 19:20
I can't think of another defence that uber could come up with though
If it relies on anything other than saying the supply was made by the driver who - likely by virtue of turnover below the threshold - isn't required to be VAT registered, all sorts of hornets' nests risk being poked
That doesn't mean that there isnt another (better) defence btw, just that I don't know enough to know of it
Could Uber's defence to the case brought against it simply be to say something like we didn't supply the service, please contact the driver? Does that close it down?
Again, I'm sure they already thought of this...
If it relies on anything other than saying the supply was made by the driver who - likely by virtue of turnover below the threshold - isn't required to be VAT registered, all sorts of hornets' nests risk being poked
That doesn't mean that there isnt another (better) defence btw, just that I don't know enough to know of it
Could Uber's defence to the case brought against it simply be to say something like we didn't supply the service, please contact the driver? Does that close it down?
Again, I'm sure they already thought of this...
Edited by anonymous-user on Tuesday 4th April 20:38
Edited by anonymous-user on Tuesday 4th April 20:45
PF62 said:
They could be relying on the PVD (2006/112/EC), Article 220 -
Every taxable person shall ensure that, in respect of the following, an invoice is issued, either by himself or by his
customer or, in his name and on his behalf, by a third party:
(1) supplies of goods or services which he has made to another taxable person
I believe there is a receipt for the journey in question, but that it doesn't show VATEvery taxable person shall ensure that, in respect of the following, an invoice is issued, either by himself or by his
customer or, in his name and on his behalf, by a third party:
(1) supplies of goods or services which he has made to another taxable person
JPJPJP said:
If you look at the parties involved in bringing the case, Jolyon Maugham QC, represented by Edwin Coe LLP with Opinion provided by George Peretz QC and Brendan McGurk
They are people and firms that know about VAT. That much is not in any doubt.
There will be an arguable case and experienced lawyers on each side. Pretty much any contested legal dispute will have lawyers arguing different sides of the same coin.They are people and firms that know about VAT. That much is not in any doubt.
In some instances, particularly small businesses and individuals, there may be an increased tendency to ignore professional advice on the merits or otherwise of pursuing a claim. For an organisation of the scale and resource of Uber, I think it would be unlikely they'd take advice that their case had little merit and still plough on regardless, as these people answer to shareholders who don't like to see profligacy on a whim or grudge.
None of which says I believe Uber will win or lose.
Well, the crowdfunding passed the stretch target before it closed last night
£107,650 has been raised. A characteristically low key announcement on Twitter
https://twitter.com/GoodLawProject/status/85473119...
£107,650 has been raised. A characteristically low key announcement on Twitter
https://twitter.com/GoodLawProject/status/85473119...
I admit my UK vat law is 20 years out of date, but can't uber argue they are an agent and not liable for the tax on the value of the transaction. Ok I know a house is out of scope but an estate agent would not be liable for the vat on a house purchase he facilities between a buyer and seller (if the house was in scope) can't uber argue they act as a facilitator between a passenger and a driver? Then they would pay vat in their service, as the estate agent does now.
We don't know Uber's stance yet.
We don't know The Good Law Project's specific approach yet either in fact.
But we will soon enough now - the stated intention is to start the case before the end of April.
There are plenty of things that would stack up to form an argument that Uber isn't an Agent and that it is the service provider. Whether the argument is sufficiently strong that a HC Judge agrees or not remains to be seen.
Also, as discussed earlier in the thread, what it actually means if the HC Judge finds in favour of The Good Law Project in whatever case it is that ends up in the court, also remains to be seen.
It is clear that the headline of the case:
TGLP: Uber should give me a VAT receipt
Uber: Uber isn't required to be VAT registered and there is, therefore, no VAT receipt
isn't necessarily going to achieve much.
So TGLP must be aiming to use the case to somehow nudge HMRC towards ruling on whether or not Uber should be registered for VAT, maybe by having the Judge say that it is not possible for her to decide the case without a definitive ruling by HMRC?
I don't know what, if any, sway a HC Judge can have over the machinations of HMRC in terms of VAT registration.
Anyway, TGLP has my tenner, so I have a (small) interest in what happens next.
We don't know The Good Law Project's specific approach yet either in fact.
But we will soon enough now - the stated intention is to start the case before the end of April.
There are plenty of things that would stack up to form an argument that Uber isn't an Agent and that it is the service provider. Whether the argument is sufficiently strong that a HC Judge agrees or not remains to be seen.
Also, as discussed earlier in the thread, what it actually means if the HC Judge finds in favour of The Good Law Project in whatever case it is that ends up in the court, also remains to be seen.
It is clear that the headline of the case:
TGLP: Uber should give me a VAT receipt
Uber: Uber isn't required to be VAT registered and there is, therefore, no VAT receipt
isn't necessarily going to achieve much.
So TGLP must be aiming to use the case to somehow nudge HMRC towards ruling on whether or not Uber should be registered for VAT, maybe by having the Judge say that it is not possible for her to decide the case without a definitive ruling by HMRC?
I don't know what, if any, sway a HC Judge can have over the machinations of HMRC in terms of VAT registration.
Anyway, TGLP has my tenner, so I have a (small) interest in what happens next.
IIRC Uber opened for business in London in mid 2012, I am quite certain it was before the Olympics
My main interest is in why HMRC is not seen to be taking any action on this matter.
That is why I contributed to the crowdfunding
If HMRC has already ruled on the matter (behind closed doors, as it should perhaps do), then the HC case will be very short indeed - Uber will simply say 'not required to register for VAT, here is HMRC confirmation' and that will be that.
If Uber should be registered for VAT and isn't, it shouldn't take a campaign like this to get it dealt with.
All that HMRC needed / needs to do is to state that it is aware of the case and that, for me, would do. I'd be happy that Uber was on HMRC's radar and that it would be dealt with in due course.
That neither HMRC nor Uber is commenting makes me think the HC case is worthwhile - for a tenner anyway.
My main interest is in why HMRC is not seen to be taking any action on this matter.
That is why I contributed to the crowdfunding
If HMRC has already ruled on the matter (behind closed doors, as it should perhaps do), then the HC case will be very short indeed - Uber will simply say 'not required to register for VAT, here is HMRC confirmation' and that will be that.
If Uber should be registered for VAT and isn't, it shouldn't take a campaign like this to get it dealt with.
All that HMRC needed / needs to do is to state that it is aware of the case and that, for me, would do. I'd be happy that Uber was on HMRC's radar and that it would be dealt with in due course.
That neither HMRC nor Uber is commenting makes me think the HC case is worthwhile - for a tenner anyway.
Inching closer
"Our Uber claim is all drafted and ready to go. We are taking advice from a specialist costs QC and will issue proceedings very shortly."
https://twitter.com/GoodLawProject/status/85783354...
"Our Uber claim is all drafted and ready to go. We are taking advice from a specialist costs QC and will issue proceedings very shortly."
https://twitter.com/GoodLawProject/status/85783354...
Not quite ready to pull the trigger just yet
https://twitter.com/GoodLawProject/status/86194095...
https://twitter.com/GoodLawProject/status/86194144...
https://twitter.com/GoodLawProject/status/86194095...
https://twitter.com/GoodLawProject/status/86194144...
https://twitter.com/goodlawproject/status/86801347...
Edited by anonymous-user on Friday 26th May 15:47
Question of potential liability for costs could be critical to progress of the case
https://www.crowdjustice.com/case/uber/
"Earlier this week we issued proceedings against Uber London Limited.
Those who funded the action will have noticed that there was a delay between the funds being collected and proceedings being issued. This was to address the question of costs in more detail.
Uber have instructed Herbert Smith Freehills (“HSF”) to act for them in the proceedings and HSF have written several letters stating that Uber will look to recover its costs from Good Law Project Director, Jo Maugham, if they lose. This is no small matter: it is perfectly possible that Uber’s costs of litigating the matter will reach £1m in the High Court alone. And, absent costs protection, that burden will fall on him personally.
Following that correspondence we took advice from a QC who specialises in costs. Having taken that advice we were able to issue proceedings. But we will need to resolve the costs issue early on in proceedings.
We appreciate that many of those who funded this case want to see it move forward quickly. Legally, we are on strong ground. Indeed, following the decision of the Advocate General we are on even stronger ground than we appreciated when the litigation was crowdfunded. And that is the most important point. However, it would be foolish to underestimate Uber’s desire to hold on to what could very easily be £1bn of tax it has avoided and interest on that tax.
We will, of course, keep you updated as matters progress."
https://www.crowdjustice.com/case/uber/
"Earlier this week we issued proceedings against Uber London Limited.
Those who funded the action will have noticed that there was a delay between the funds being collected and proceedings being issued. This was to address the question of costs in more detail.
Uber have instructed Herbert Smith Freehills (“HSF”) to act for them in the proceedings and HSF have written several letters stating that Uber will look to recover its costs from Good Law Project Director, Jo Maugham, if they lose. This is no small matter: it is perfectly possible that Uber’s costs of litigating the matter will reach £1m in the High Court alone. And, absent costs protection, that burden will fall on him personally.
Following that correspondence we took advice from a QC who specialises in costs. Having taken that advice we were able to issue proceedings. But we will need to resolve the costs issue early on in proceedings.
We appreciate that many of those who funded this case want to see it move forward quickly. Legally, we are on strong ground. Indeed, following the decision of the Advocate General we are on even stronger ground than we appreciated when the litigation was crowdfunded. And that is the most important point. However, it would be foolish to underestimate Uber’s desire to hold on to what could very easily be £1bn of tax it has avoided and interest on that tax.
We will, of course, keep you updated as matters progress."
The Mad Monk said:
Why are you so interested in what Uber does or doesn't do?
At the risk of repeating myself (again), I am interested in why it is taking a private prosecution to get the question of a potential several hundred million pound VAT liability looked at. That it is Uber that is involved is of no real interest to me.
That it isn't HMRC that is being seen to be asking the question is of great interest to me
PurpleMoonlight said:
So basically they want to sue Uber with someone else's money and don't want to have to pick up Uber's tab if they lose.
This was specifically set out in the fund raising pitch"It is impossible to know what the litigation will cost. It will depend upon what Uber says and what the High Court says. But our initial target of £75,000 will cover the bulk of our costs of bringing the case in the High Court. Our lawyers are all acting at considerably below market rate. But we are likely to need to raise a further sum both for additional legal expenses and to ensure that, because Jo Maugham has no private interest in the litigation, he is not personally exposed to the costs of losing."
I think it would be a great shame if the case could not proceed purely due to the depth of Uber's pockets.
Edited by anonymous-user on Friday 26th May 19:28
I referred to the potential liability.
That is all it is just now, a potential liability, Uber may well have no requirement to register for VAT and absolutely no liability whatsoever.
I would expect that, behind the scenes, a tax QC that may be on the panel from which HMRC chooses its QCs would have a way of knowing, even if only informally, if a case he was about to publically stake a big chunk of his reputation on was already on the desk of someone at HMRC....
Is that an expectation too far?
That is all it is just now, a potential liability, Uber may well have no requirement to register for VAT and absolutely no liability whatsoever.
I would expect that, behind the scenes, a tax QC that may be on the panel from which HMRC chooses its QCs would have a way of knowing, even if only informally, if a case he was about to publically stake a big chunk of his reputation on was already on the desk of someone at HMRC....
Is that an expectation too far?
There is a piece here from 12 May on Bloomberg BNA titled "EU Court Aide Ruling Delivers Blow to Uber's UK VAT case"
https://www.bna.com/eu-court-aide-n73014450820/
"The EU’s top legal adviser has dealt a blow to Uber Technologies Inc.’s plan to fight claims for unpaid value-added tax in the U.K., classifying it as a transport provider instead of a technology platform."
In the first reference I have so far seen to any comment on the matter by Uber, this article contains
"Commenting on the pending VAT case, Uber said in a statement that drivers who use its smartphone application will be registered for the indirect tax if they meet the U.K.’s threshold of 85,000 pounds.
This has been the case across the taxi and private hire industry for decades,” the statement said. Black cab drivers and the apps they use, such as Gett or myTaxi, “operate in exactly the same way
This claim is fundamentally flawed on a number of levels,”
https://www.bna.com/eu-court-aide-n73014450820/
"The EU’s top legal adviser has dealt a blow to Uber Technologies Inc.’s plan to fight claims for unpaid value-added tax in the U.K., classifying it as a transport provider instead of a technology platform."
In the first reference I have so far seen to any comment on the matter by Uber, this article contains
"Commenting on the pending VAT case, Uber said in a statement that drivers who use its smartphone application will be registered for the indirect tax if they meet the U.K.’s threshold of 85,000 pounds.
This has been the case across the taxi and private hire industry for decades,” the statement said. Black cab drivers and the apps they use, such as Gett or myTaxi, “operate in exactly the same way
This claim is fundamentally flawed on a number of levels,”
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