The London Employment Tribunal finding in a test case that Uber divers are its employees, not so-called partners or supposed contractors, has huge tax implications. As well recognising that the drivers have worker’s rights in law, eg holidays and sick pay, the Tribunal showing Uber as a taxi business, not just the tech company it claimed, has tax repercussions.
As well as looking at Uber on driver income tax and national insurance (NI) there will also likely be implications for Uber’s own tax position. As well as corporation tax the biggest bill may be for Uber’s own output VAT liability as a taxi business.
Uber says it will appeal. But the Tribunals’ full 40 page written reasons made some very damning findings of fact against Uber. These facts will be hard to overturn on appeal. That plus the Tribunal looking through the contrived terms and conditions, written by Uber’s army of lawyers, which it found simply misrepresented the true rights and obligations.
One would not expect HMRC to challenge a US tech company’s position, of course. But now an Employment Tribunal has ruled it may be difficult for HMRC to avoid taking any action.
Aslam & Farrar v Uber BV & Uber London Ltd – Employment Tribunal case 2202550/2015
Tax Barrister, Accountant