- The Supreme Court ruled against Uber in a case regarding VAT obligations for private hire operators PHOs.
- The court upheld that PHOs licensed under the 1976 Act can choose between agency or principal contracting models.
- As principal, PHOs pay VAT on the full fare; as agents, they account for VAT on fees charged to drivers.
- The decision maintains the status quo for PHOs outside London, allowing flexibility in contracting models.
- PHOs in London must contract as principal under the 1998 Act, paying VAT on the full fare.
- This creates a potential for VAT rate shopping between operators inside and outside London.
- HM Treasury launched a consultation on VAT treatment for private hire vehicles, with responses pending.
- Bolt Services UK Ltd is also involved in litigation with HMRC over VAT treatment for ride-hailing services.
Source: mha.co.uk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
