back to article Crowdfunded lawyer suing Uber told he can't swerve taxi app giant's £1m legal bill

A millionaire barrister who started a crowdfunded lawsuit against taxi app maker Uber over a £1 VAT receipt has lost his attempt to stop Uber claiming legal costs against him. In a judgment handed down today, Mr Justice Trower rejected both Jolyon Maugham QC's attempt to shield himself from a legal bill of up to £1m and his …

  1. Voyna i Mor Silver badge

    Oh well...

    Live by the fees, die by the fees.

    1. This post has been deleted by its author

  2. John Robson Silver badge

    Can we not find a bankrupt ex business man

    to be the front for the case?

  3. Paul Crawford Silver badge

    Uber argues that it "does not itself provide transportation services" and is therefore not subject to VAT on its taxi journeys.

    So can I pull the same stunt on any work I get involved with? If not then fsck Uber in to the ground on tax liability.

    1. Mr Humbug

      Sounds like it's trying to put itself in the same position as eBay and Amazon Marketplace - an order processor and payment intermediary, not the provider of goods and services. Presumably the fee it charges to drivers includes some element of VAT.

      1. katrinab Silver badge
        Unhappy

        "Presumably the fee it charges to drivers includes some element of VAT."

        It doesn't. You don't need a VAT number to reverse-charge VAT on supplies of services to business customers. The taxi drivers would be required to register for VAT, pay the VAT on this import of services, and simultaneously claim it back. Except they will argue that they are employees, and the net amount they receive is their wages, and therefore they don't have to do this.

        1. K Silver badge
          Pint

          @katrinab A beer for you sir/madam!

          If I'm reading that correctly - VAT rules are not suited for today's economy... and by failing to keep pace, its providing another loophole.

          1. sabroni Silver badge

            re: VAT rules are not suited for today's economy...

            Only if you buy Uber's claim that they aren't a taxi company.

            Seems pretty obvious that they are a taxi company.

        2. SolidSquid

          From what I remember, even if they were contractors, unless their income is over a certain amount they aren't going to have to be VAT registered (and they almost certainly don't through uber), and in that case they aren't able to charge VAT in the first place. If that's what happened then the case goes out the window because there was no VAT to create a VAT receipt for in the first place

          1. DavCrav Silver badge

            "If that's what happened then the case goes out the window because there was no VAT to create a VAT receipt for in the first place."

            That's why, I guess, the request was for a VAT receipt for £1.06 rather than the whole £6.34. It looks like its Uber's portion. It would have been good for there to have been more detail about the case itself in the article.

            1. sabroni Silver badge

              Yeah, fine, just ignore my totally valid point that they aren't contractors but employees of Uber.

              1. DavCrav Silver badge

                "Yeah, fine, just ignore my totally valid point that they aren't contractors but employees of Uber."

                Erm, OK. I mean, I wasn't talking to you, but whatever.

  4. Charles Calthrop

    a lawyer vs uber.

    can they somehow both lose please?

    1. This post has been deleted by its author

  5. Anonymous South African Coward Silver badge

    Amazing how a dispute over a £1-something quickly escalated into a £1-mill something...

    1. katrinab Silver badge

      It was never about the £1, it was about getting Über to pay tax.

      1. LucreLout Silver badge

        It was never about the £1, it was about getting Über to pay tax.

        That and the oxygen of more publicity for a certain QC.

  6. Chris G Silver badge

    According to gargle, UK Uber drivers mske between £10 and £16/hr. I was doing better than that in the 80s mini cabbing, we had hire and reward insurance,paid £40 a week for the radio and the rest was ours. I paid back a £2000 loan in six months, cabbing in the evenings after my daytime job.

    Uber sounds like one of those cuddly 10 plus percenters who like to shaft both ends of a deal.

    1. kirker

      Nearly all income estimates for Uber drivers (both in the UK and elsewhere) are off-base, if only because obtaining pay stub data is all but impossible. Uber certainly doesn't hand it over, nor are its drivers required to do so.

      Regardless, the 'best guesstimates' typically fail to take into account the surge pricing that serves as the main reason drivers work for them. £40/hour isn't uncommon on weekends when the Tube stops running and pissed wankers want to get home and pass out as quickly as possible.

    2. maffski

      'Uber sounds like one of those cuddly 10 plus percenters who like to shaft both ends of a deal.'

      Nope, they've just doing exactly what your cab firm did back in the 80's. But rather than a base rent for the radio it's a transaction fee for the app / billing services / advertising.

    3. Velv Silver badge
      Headmaster

      Uber sounds like one of those cuddly 10 plus percenters who like to shaft both ends of a deal

      Try 25% in Uber’s case

    4. Anonymous Coward
      Anonymous Coward

      A quick Google search for weekly private hire costs shows prices have gone it considerably:

      £160-£200 radio rent/week

      £125+ fuel/week

      You can make money doing it and even good money if you put in long hours, but it's a lot tougher to make decent money than in the past unless you have a lot of regulars or you do the evening/late shifts and deal with the drunks.

  7. Anonymous Coward
    Anonymous Coward

    A lawyer liable for huge lawyers fees, hahahahaha. Best news I've heard about a lawyer since Andrew Crossley was dragged before the SRA.

    It's stories like this that occasionally pull on my atheist strings and move me a little towards agnosticism, albeit briefly.

    1. SImon Hobson Silver badge

      Downvoted because I don't think you read the same article I did.

      This isn't about shady practices like Crossley was found guilty of, it's about someone standing up for "right" and big business using massive legal bills to try and stop him taking it further. Uber's business model relies on ignoring laws or at least applying "interesting" interpretations - no the drivers aren't employees so we can skip all those employer costs and obligations, no we aren't providing the services so we can ignore that pesky VAT, and so on.

      This guy is trying to get a ruling on the VAT - and if he wins it sounds like Uber could be on the hook for a very very large amount of cash. It sounds like they are deliberately loading up the legal fees - nah, one barrister isn't enough, lets use 5, sort of thing - in an attempt to frighten him off. In the subject of this article, he was trying to get a court to limit the costs that he'd face if he loses - and he's failed to get that.

      1. Jim Mitchell

        My opinion is that if you need 1 million £s worthy of lawyers to explain that your interpretation of your VAT obligations is legal, then maybe your interpretation isn't that legal.

        1. Bonzo_red

          These VAT lawyers can earn millions arguing whether a Jaffa cake is a cake or a biscuit though.

      2. FozzyBear Silver badge

        I daresay that a large amount of ego entered the equation considering the trivial amount involved. Most people would shrug their shoulders over an amount less than a coffee. If you felt righteous a phone call to the tip line of your taxation office would set the hounds on the trail. More importantly the federal government will be responsible for picking up the tab if the decision went against them

        1. joeldillon

          Firstly, the UK does not have a 'federal government'.

          Secondly, HMRC is only going to prosecute if it feels like it and if it thinks Uber has broken the law. This chap was trying to hurry the process along a little.

          1. adam 40

            Jaffa Cakes!

            After the hilarious Jaffa Cake trial, maybe HMRC is being a little more cautions in bringing cases.

            But for £1`bn I am surprised they haven't jumped on this one....

        2. STOP_FORTH

          Constitutional note

          I believe Germany has a federal government, probably Australia and Canada too. Here in the UK we have a constitutional monarchy.

          No feds here.

          1. Anonymous Coward
            Anonymous Coward

            Re: Constitutional note

            really, I thought it was a pure democracy to realise the will of the people?

        3. Valeyard

          More importantly the federal government will be responsible for picking up the tab if the decision went against them

          that's very nice of them to do that in London

        4. norep

          @FozzyBear re: tip line of your taxation office

          Not a guaranteed path of recourse.

          Fact: many years ago that well-loved UK web hosting company Fasthosts insisted on charging me VAT – long after I had migrated permanently from Blightly.

          When I asked for the VAT to be removed from future transactions and the VAT component they'd already deducted (it took me a while to notice!) to be refunded to me, I got a firm 'NO'.

          So I let HMRC know what Fasthosts was up to.

          Guess what? The tax office couldn't give a flying fcuk

          1. Blah blah brexit

            Re: @FozzyBear re: tip line of your taxation office

            For two reasons.

            As you are not vat registered but still within the EU, you were liable for vat.

            Secondly, the place of supply is still the UK, guess what? Yep you’re still liable for UK vat.

        5. DavCrav Silver badge

          "I daresay that a large amount of ego entered the equation considering the trivial amount involved."

          Actually, it's a large amount of something called 'precedent', that he is trying to have enter the equation.

      3. LucreLout Silver badge

        it's about someone standing up for "right" and big business using massive legal bills to try and stop him taking it further

        It's actually about someone wriggling on the hook while being given a taste of his own medicine. "Right", much like "fair", or "moral" is an entirely meaningless fungible concept.

        It sounds like they are deliberately loading up the legal fees - nah, one barrister isn't enough, lets use 5, sort of thing - in an attempt to frighten him off

        Which is a tactic he is almost certain to have engaged in himself as part of his profession, only in those situations the QC would be working for the big boys shafting the little man.

        Having been on the reciving end of such behaviour (£xx,xxx counter claim from a FTSE 100), I'm well aware of how stressfull it is; even when you win it takes a psychological toll. As someone that has climbed to the very top of his profession, I'd expect a roll call of people screwed over by any QC to read like the bumper book of baby names, and as such, I must confess to a small amount of schadenfreud.

        Personally, I'd like to see some rigid cost capping implemented in the legal system, such that fighting your corner doesn't come at the expense of your house, but the entire legal system is working night and day to prevent that happening.

        1. ShadowDragon8685

          Here's the way I'd do it, then.

          In any "David vs. Goliath" legal battle, David takes his case before the court/dock/magistrate/whatever and tries to claim Davidian status.

          If David wins this argument, presumpting that the court has found that David's case has any merit whatsoever, the court hands down a ruling that Goliath must provide to David 1 Foo for their own legal costs for every 1 Foo that Goliath spends on theirs. This money is forfeit; whether David wins or loses, Goliath has engaged in battle in the courts with David, and the courts must be a fair battleground for the law.

      4. Anonymous Coward
        Anonymous Coward

        >Downvoted because I don't think you read the same article I did.

        Just hold on there a moment there Sir, if you read the article and just where his funding came from to pay his own "self representation fees" from there it puts a different light on his motives. It's not the same as the two environmentalists that took on McDonalds over their leaflets. In my opinion he is a paid stalking horse for the incumbent cabbies, he's gambled a tactic to limit their liability should they lose which the judge has rightly seen through.

        The only honest lawyer is a cremated one, even then I'd be very careful handling that urn and count your fingers when you put it down.

      5. kirker

        "This isn't about shady practices like Crossley was found guilty of, it's about someone standing up for "right" and big business using massive legal bills to try and stop him taking it further."

        This might be plausible if he hadn't accepted a massive payoff from the black cab trade into his "crowdfunding" campaign. In the richest of ironies, those monies aren't subject to tax because they're considered "donations."

        "This guy is trying to get a ruling on the VAT - and if he wins it sounds like Uber could be on the hook for a very very large amount of cash."

        His estimate is utterly preposterous. Even if he did somehow magically win back VAT for every ride provided by Uber in the UK & EU to date, it'd likely be an eight-figure sum, not ten (!!).

        "It sounds like they are deliberately loading up the legal fees - nah, one barrister isn't enough, lets use 5, sort of thing - in an attempt to frighten him off."

        Having worked with barristers on various legal matters on numerous occasions, the fees sound typical to me. It costs a bloody fortune to pursue cases in courts of law.

    2. Arel

      You're happy that an attempt to force Uber to stop dodging tax is likely to be forced to stop because they're going to be able to threaten millions of dollars in costs?

      I imagine you're equally thrilled that Amazon, Google and Starbucks also manage to evade these inconvenient costs.

    3. Robert Helpmann?? Silver badge
      Childcatcher

      It's stories like this that occasionally pull on my atheist strings and move me a little towards agnosticism, albeit briefly.

      The very existance of lawyers ought to sober you right up, then.

  8. Alan Penzotti
    Go

    Who is ultimately responsible for collecting/paying the VAT

    With a traditional taxi, the cab driver is responsible for collecting fees (cash) and offering (cash) receipts. Same with credit cards, although there is a more detailed paper trail that can be reconciled with monthly statements/expense claims.

    It is noted that there is no cash/credit transaction between the driver and Uber (outside of tips.)

    If I were the judge, I would find in favor of the plaintiff, but only award him £1, and then declare the Uber is on the hook for (%VAT) of all fares collected in the UK, along with all retroactive taxes, fees, and penalties from day one of their UK business.

    By siding with the plaintiff, it would quench any chance at an appeal since they were the prevailing part, and hopefully encourage out of court settlements on such egregious cases.

    1. matjaggard

      Re: Who is ultimately responsible for collecting/paying the VAT

      I don't think an out-of-court settlement would do anything here. He (clearly) doesn't care about his £1, he wants to make Uber pay VAT.

      1. tony

        Re: Who is ultimately responsible for collecting/paying the VAT

        > he wants to make Uber pay VAT.

        Wouldn't it be the customers who pay VAT, so he's hoping Uber customers having to pay 20% more may be enticed to take black cabs?

      2. Blah blah brexit

        Re: Who is ultimately responsible for collecting/paying the VAT

        I don’t think he actually cares at all, but his clients do.

    2. Ian Michael Gumby Silver badge

      Re: Who is ultimately responsible for collecting/paying the VAT

      So the article isn't about the outcome of the trial.

      It appears, if I understand this , the argument is that the Lawyer wants to cap his damages if he loses.

      If he wins, he will then be able to sue Uber again for a 1 billion in a follow up lawsuit. That's his huge payday.

      1. Eguro

        Re: Who is ultimately responsible for collecting/paying the VAT

        He obviously can't get a billion pounds from Uber on the grounds that Uber hasn't paid VAT.

        He can get a legal ruling that states, that Uber must pay VAT, which means they will owe money to the UK who will be getting the billion pounds. For him it seems that will merely mean that he can claim the £1,xx on a returns form somewhere in the bureaucracy.

        In what way would he ever have any standing to get VAT money from rides others have bought from Uber (Or should that be from their respective Uber driver who is in no way an employee of Uber?)?

        1. xeroks

          Re: Who is ultimately responsible for collecting/paying the VAT

          The thing is that if this were to be successful, it isn't Uber who pays the VAT, in the end. It's us consumers.

          All Uber would do - if forced - is add 20% on top of the bill and pass the money onto the taxman.

          So I guess what this case is about removing the 20% advantage Uber has over VAT registered taxi companies.

          1. Loyal Commenter Silver badge

            Re: Who is ultimately responsible for collecting/paying the VAT

            The thing is that if this were to be successful, it isn't Uber who pays the VAT, in the end. It's us consumers.

            All Uber would do - if forced - is add 20% on top of the bill and pass the money onto the taxman.

            So I guess what this case is about removing the 20% advantage Uber has over VAT registered taxi companies.

            That 20% advantage I think is exactly the point of his case. Uber should be able to compete with traditional cabbies on an equal footing. The fact that they are orgasnised and have payment and booking infrastructure should mean that they are perfectly capable of doing this, whilst also paying tax into the treasury.

            It's not a case of the end user paying that 20% into the treasury, it's a case of them not paying that 20% into Uber's coffers.

      2. Lusty Silver badge

        Re: Who is ultimately responsible for collecting/paying the VAT

        Firstly, he's not a lawyer, he's a barrister. They are very different things.

        What he's actually doing is trying to change the law in the way the UK legal system was designed. Everybody seems to be in agreement that the way VAT is collected in this instance is wrong. He's using this case to make it right. It's not about proving Uber are doing something wrong right now so much as changing the way they work in the future. Uber will fight this because if they become liable for the VAT then by definition the drivers will work for them and they become just another cab company with all of the responsibilities that go with that.

        I'm not sure which side I'm on. Uber have technically done nothing wrong, their service is good when they are allowed to operate.

        We do need that tax money though. If too much money flows away from a country without being taxed at source then there will be trouble ahead. Entities like the EU and IMF tax at a wider scale and return via subsidies to redistribute, but that isn't an ideal way to get the money back to the right places.

        1. LucreLout Silver badge

          Re: Who is ultimately responsible for collecting/paying the VAT

          Everybody seems to be in agreement that the way VAT is collected in this instance is wrong. He's using this case to make it right.

          Right & wrong aren't helpful words when crafting an arguement. They don't mean whatever it is you think they mean to anyone else reading this.

          We do need that tax money though. If too much money flows away from a country without being taxed at source then there will be trouble ahead.

          Need is subjective also. We need the private sector to generate profits. We need them to retain and distribute those profits such that the economy functions.

          Tax is already at generational highs in terms of percentage of GDP collected, and has gone so far round the Laffer curve that any further collection attempts yield a lower amount of tax collected in total. At this point, we need either economic growth, which you cannot tax your way towards, or we need more efficient public spending, or both. What we don't need, because we can't actually have it, is a greater percentage of GDP taxen as tax.

          1. DavCrav Silver badge

            Re: Who is ultimately responsible for collecting/paying the VAT

            "Right & wrong aren't helpful words when crafting an arguement. They don't mean whatever it is you think they mean to anyone else reading this."

            They really do in a Common Law jurisdiction. If the QC can show that the way the rules are being implemented is incompatible with the intention of the original lawmakers, then the judiciary can set a precedent that the interpretation should be more in line with 'common sense'. Such statements as 'a reasonable person' do show up in the law.

          2. Lusty Silver badge

            Re: Who is ultimately responsible for collecting/paying the VAT

            "We need them to retain and distribute those profits such that the economy functions."

            That was my point. It's not one economy. Uber are sucking one economy dry and putting the money into another. Tax is the method by which we balance that usually, in order to retain some of the money in the original economy. The EU and IMF are there to rebalance on a wider scale than just within one economy.

            As an example the UK gives money to the EU from taxes collected overwelmingly in London, and some of that money will be sent by the EU to pay for roads and education in Wales. The people of Wales will then buy goods and services from London based companies. This also works if you replace Wales with Romania.

            1. M.V. Lipvig

              Re: Who is ultimately responsible for collecting/paying the VAT

              From the complaints I've seen, the EU has been taking tax money from England and using it to build roads in Brussels, so the roads in Brussels are so smooth you don't need shocks on your car for a smooth ride while the roads in London are a huge game of "connect the potholes."

              I can't speak from direct experience though, as I've only been to Heathrow and I've never been to Belgium. Germany sure has some nice highways though.

        2. BinkyTheMagicPaperclip Silver badge

          Re: Who is ultimately responsible for collecting/paying the VAT

          ' their service is good when they are allowed to operate'

          By 'good' do you perhaps mean cheap and efficient by exploiting loopholes in the law, until they've destroyed all competition at which point they can price however they like, plus leaving a swathe of poorly paid taxi drivers in their wake?

        3. Cederic

          Re: Who is ultimately responsible for collecting/paying the VAT

          Re: "Uber will fight this because if they become liable for the VAT then by definition the drivers will work for them"

          I'm not sure that follows. The customer pays the money to Uber for the service, and that's why Uber should be liable for the VAT involved, but that doesn't preclude Uber engaging a third party (e.g. a car driver) to fulfil the service on their behalf.

        4. Ian Michael Gumby Silver badge
          Boffin

          @Lusty, Re: Who is ultimately responsible for collecting/paying the VAT

          Ok, that makes sense.

          In the states... it would be a case of Uber being a tax dodge. So where I said he'd sue for 1 billion if he wins this lawsuit, it would be that the IRS would go after Uber, and then as the whistle blower, he'd get a reward which would be substantial.

          But then again. this aint the US.

          To give you an example... the HSBC employee who blew open the US tax dodgers who had overseas accounts and were under reporting income.... while he faced jail in Switzerland, he was up for a massive reward as the whistle blower. Millions IIRC.

      3. chris 143

        Re: Who is ultimately responsible for collecting/paying the VAT

        I don't see how he'd be able to make any claim on owned back taxes. Unless hmrc have some sort of finders fee reporting incentive

      4. Andy The Hat Silver badge

        Re: Who is ultimately responsible for collecting/paying the VAT

        Not sure there can be a 'follow-up' for significantly more than his losses plus reasonable compensation. HMRC would be the responsible party to claim back the VAT in whatever way they see fit and, to be honest, if there is such a large amount of unpaid VAT easily available I would have expected HMRC to be on the case already. On the other hand, Amazon and Google's massive tax bills show how good and willing HMRC are to push this awkward tax collecting jobbie...

      5. Arel

        Re: Who is ultimately responsible for collecting/paying the VAT

        Please re-read the article. The lawyer is not out for a huge payday. He's an activist trying to curtial Uber's tax evasion in the UK.

        1. johnfbw

          Re: Who is ultimately responsible for collecting/paying the VAT

          He is a political activist. The article even says that the black cab drivers have fronted him 20k. This isn't about VAT it is another step in the sage of Black Cab vs Uber. (and I bet that black don't register for VAT even when they receive over the 85k limit)

        2. John Sager

          Re: Who is ultimately responsible for collecting/paying the VAT

          If Uber are actually evading tax, then HMRC would go after them, so the fact that HMRC have not so far done so suggests that they aren't evading tax. They could be avoiding tax, as we all do in one way or another - arranging our affairs to minimise tax payment.

          I guess if HMRC really think that Uber are trying it on, then they would go after them, as they have for many other modes of business set up to minimise tax liability.

          1. graeme leggett

            Re: Who is ultimately responsible for collecting/paying the VAT

            HMRC does not always collect all that is owed. And may need prompting to act.

            It reached an agreement with Goldman Sachs in 2010 which avoided the latter paying interest on about 20 million quids worth of National Insurance Contributions they hadn't paid relating to offshore bonuses (I believe)

            The HMRC had settled because Goldman Sachs had threatened to withdraw from a voluntary code of conduct. Judge said it “was not a glorious episode in the history of the Revenue.” Those in HMRC who had made the agreement hadn't consulted legal experts nor noticed they had to have the deal reviewed internally.

          2. Anonymous Coward
            Anonymous Coward

            Re: Who is ultimately responsible for collecting/paying the VAT

            Having dealt with HMRC on more than one occasion, I can report that they don't have the smartest legal minds. Lots of tenacity and an incredible focus on utilising their own inaccurate reports to fcuk you over, but not particularly well honed legal skills.

            They also don't have a remit to seek to change UK tax law, only enforce it.

            If this case succeeds, then it may lead to a radical rethink of taxation in the digital age... but I wouldn't hold my breath.

          3. james_smith

            Re: Who is ultimately responsible for collecting/paying the VAT

            "If Uber are actually evading tax, then HMRC would go after them"

            That's an incredibly naive assumption.

        3. This post has been deleted by a moderator

        4. Natalie Gritpants Jr

          Re: Who is ultimately responsible for collecting/paying the VAT

          He will get a huge pay day if he wins: his costs. This ruling just confirms that if he loses Uber's lawyers get a big pay day. Seems fair to me.

          1. Loyal Commenter Silver badge

            Re: Who is ultimately responsible for collecting/paying the VAT

            He's suing them for £1.something, not £1.something plus costs.

            From what I understand, he is bringing this as a test case, not as a way to make money (he's plenty rich enough already), but as a way to set precedent (one of the two ways laws are made in this country, the other being through primary legislation). I would honestly be surprised if black cabbies weren't supporting him in this, as it's obviously in their interests. It doesn't follow, however, that their interests are his reason for bringing the case. Two people can want the same thing for different reasons.

            And for thos people here who are implying that the is nothing more than a lawyer of the ambulance-chsing variety, I'll point out that you don't get to be a QC by chasing ambulances.

      6. Godwhacker

        Re: Who is ultimately responsible for collecting/paying the VAT

        No, read the article. He doesn’t want to sue Uber to make money, he want Uber to be liable for the VAT it is avoiding by creating an exploitative tax avoidance structure.

    3. kirker

      Re: Who is ultimately responsible for collecting/paying the VAT

      "It is noted that there is no cash/credit transaction between the driver and Uber (outside of tips.)"

      Well, yes and no. Uber pays drivers via direct deposit into their bank accounts. While it's not *literally* a cash transaction, it's nearly the equivalent of one.

      In any event, a British court has already ruled that Uber is a transportation service, not a "technology company," so even with independent operators as drivers they should still be on the hook for the same taxes/fees required of black cab drivers.

    4. the spectacularly refined chap

      Re: Who is ultimately responsible for collecting/paying the VAT

      If I were the judge, I would find...

      It's probably a good thing you're not the judge then. Call me old-fashioned but I'd expect the judge deciding any case I was involved in to listen to the case. Allowing the case to proceed and not announcing your verdict before the case has been heard is a necessary prerequisite.

      There are way too many here who fall into the same trap. Reading a few brief articles in the media does not make you an expert in the matter. If you happen to be legally qualified and have considered all the evidence available then maybe you have an opinion that is worth listening to. Otherwise it is an ill considered and ignorant knee jerk reaction.

    5. LucreLout Silver badge

      Re: Who is ultimately responsible for collecting/paying the VAT

      If I were the judge, I would find in favor of the plaintiff, but only award him £1, and then declare the Uber is on the hook for (%VAT) of all fares collected in the UK, along with all retroactive taxes, fees, and penalties from day one of their UK business.

      Judges dislike nothing more than being overturned on appeal; it goes to their competency. Any judge agreeing with your view would be overturned.

      You might not like what Uber does; you might not like how Uber does it; but what Uber does is neither illegal, nor does it attract VAT. It's a ride booking service for independent contractors who may or may not be VAT registered and able to issue such receipts. There's no requirement in law for a cabby to register for VAT unless his turnover is something like £80k+.

      Changing the law to target a handful of companies is all well and good in theory, but in reality, the companies you'll cripple by doing so will end up being none of the ones targetted and not companies you had a problem with.

    6. Anonymous Coward
      Anonymous Coward

      Re: Who is ultimately responsible for collecting/paying the VAT

      INAL, but it does look like Uber would win this. Uber aren't providing the actual transportation as they do not own the car or the driver (yes, I'm aware of the workers rights case where the drivers were considered employees, but that is only in relation to rights, it doesn't mean they are no longer actually self-employed!). They are providing a service to facilitate the sale of transportation and as the payment processor for the driver for that transportation service.

      It's similar to you selling something through eBay using Paypal as your payment processor. eBay and Paypal aren't responsible for the VAT on what you sell, that's down to you as the seller if you meet the VAT threshold.

  9. Anonymous Coward
    Anonymous Coward

    A 2 B

    If I want a taxi that is ‘definitely on its way guv, it’s just round the corner’ I ring for a taxi, if I want a reliable service I use Uber.....

    1. d3vy Silver badge

      Re: A 2 B

      I've been stood outside in the rain waiting for several Ubers which all got within 1/4 of a mile of me, realised the traffic was bad where I was and turned around to head to areas where they can get a higher throughput of clients.

      Literally 6 in a row, watched them on the map get to where the roadworks were and then turn round and head back to the centre.

      Eventually got one, but that experience really put me off the service for a while.

      Generally reliable, but only if you're within an area that they can make money quickly... I suppose it's no different from black cabs refusing to go over the river in the evenings!

      1. Anonymous Coward
        Anonymous Coward

        " I suppose it's no different from black cabs refusing to go over the river in the evenings!"

        Can they? Here taxis can't refuse to bring you anywhere within the city boundaries. any hour. I believe that if taxi services have stricter regulations and can't refuse less remunerating travels, it's right they have some protection from services like Uber who would just get the most remunerating one, and in the end will just create a disservice to those living/working in less appealing areas.

        1. STOP_FORTH

          Re: " I suppose it's no different from black cabs refusing to go over the river in the evenings!"

          Black cabs in London are obliged to take you up to six miles from Charing Cross. You might get to Putney, but most of South London is too far. Since many cabbies live in Essex, they also prefer their last fare of the night to be travelling East so they can be paid for part of their journey home.

          I have never used Uber, but you can see they may be able to fill some gaps in the existing system in London.

          1. graeme leggett

            Re: " I suppose it's no different from black cabs refusing to go over the river in the evenings!"

            "A taxi driver, unless required by the hirer to drive more than 12 miles, or more than 20 miles in respect of a journey which begins at Heathrow Airport, London, or for a longer time than one hour, is under a duty to accept a fare:"

            "A taxi driver is under a duty to drive the hirer of his taxi to any place within the Metropolitan Police District or the City of London not exceeding 12 miles from the place where he was hired; or more than 20 miles in respect of a journey which begins at Heathrow Airport, London"

            Says TFL

    2. RyokuMas Silver badge
      Facepalm

      Re: A 2 B

      Fine until you get greyballed...

    3. tiggity Silver badge

      Re: A 2 B

      Uber is mainly in a few larger cities / towns in the UK, so not available in many places... (far easier / profitable to focus on big cities with large population & population density than the less lucrative areas outside cities)

      I have a few taxi companies that cover where I am based (not a city so not Uber) - using them soon revealed which ones were good and which ones were bad on pick up times / inappropriate (i.e. more expensive) routes etc.

      The good ones get repeat business, the bad ones do not.

      Nice and simple and no involvement of tax dodging Uber required.

      Ironically when i am in nearest city, a lot of the uber drivers are drivers who work for various city based cab firms anyway (the drivers use magnetic labels as cars are their own so no taxi co custom paintjobs, so when working for Taxi Co Z they slap on a taxi Z label, when doing Uber work they put on the Uber label etc.) - found this out by chatting to them (as do use taxis in the city too, just far less often as normally adequate public transport in the city does the job)

      1. d3vy Silver badge

        Re: A 2 B

        "Uber is mainly in a few larger cities / towns in the UK, so not available in many places... (far easier / profitable to focus on big cities with large population & population density than the less lucrative areas outside cities"

        Except I was going from Drury lane to Belgravia... Hardly miles from the centre.. they chose not to pick me up because it meant waiting for a extra minutes in traffic to get to me.

    4. Anonymous Coward
      Anonymous Coward

      Re: A 2 B

      If I want a random taxi driven by an unchecked driver, that may be the car I ordered, or may be john worboys,bi use a taxi. If I want better protection, namely knowing the registration of the car that I need to get in, and some from of route logging, and basic background checks, I use Uber...

  10. pleb

    If he thinks the £1M legal bill is too high, perhaps he should start campaigning for lawyers to charge less. Live by the sword, die by the sword.

  11. hoofie

    No doubt Her Majestys Customs and Revenue are watching on from the sidelines rather interested. Why spend all that money trying to nail Uber if some other muppet is trying to do it for you ?

    I've got f-all sympathy for this chap - happy to rely on crowd-funding rather than his own money but doesn't like it when it all goes tits-up. I think he forgot that sometimes the Courts don't do what you want. He also deserves it solely for his Brexit work but that's an aside.

    Note : Whilst Uber do offer a service [I use them myself as they are much better than thieving taxi drivers here in Australia who drive old shit-boxes] I am happy to see them cough up more money to the Treasury.

  12. Anonymous Coward
    Anonymous Coward

    Sounds to me that the QC is trying to set up a 'heads I win - tails you lose' situation by leaving Uber liable for huge costs even if they win. The judge identified a likely legal cost bill of £1m, but the QC attempted to limit it to a derisory £20k. Perhaps if he had tried to set a more reasonable limit he would have been successful !!

    1. LucreLout Silver badge

      The judge identified a likely legal cost bill of £1m, but the QC attempted to limit it to a derisory £20k.

      Lets say I had £1Bn, and you were suing me in a way that I would lose it. My legal bill would dwarf £1Mn..... You're talking about a legal bill of less than 0.1% of what it might cost me to lose.

      Given that the courts have previously found it reasonable for a legal bill to be more than 10 times the amount under dispute, this chap can think himself lucky he's not facing a claim for several billion in costs.

    2. BinkyTheMagicPaperclip Silver badge

      Surely, if Uber's position is so unassailable, they don't need the expensive lawyers and won't be liable for expensive legal costs.

      Unless, of course, they're operating on the fringes of what's permissible.

      (yes, I do know it's not that simple when defending yourself, but the general principle still holds)

  13. Juan Inamillion

    Missing the point

    A good few commentaries seem to be missing the point. You can consider it a test case. It's not about claiming the £1 in VAT it's about the principle. Yes, I realise that 'lawyer' and 'principle' in the same sentence might be considered an oxymoron but he's trying to force the issue with regards to Uber's position as an 'employer' and it's liability for taxes, especially VAT.

    I don't think ego comes into it, certainly not any reward.

  14. The Godfather
    FAIL

    Well, I gave it a go and......oh bother

    Looks like an attempt to have a go at Uber and it’s operations that may well have gone wrong.

  15. Ptol

    HMRC need to sit it out...

    If HMRC joined in as a plaintiff, and the case is lost, then they are on the hook for a share of the winers costs. Why would they want to expose themselves to that, if they thought the plaintiff was doing a reasonable job, (or though that the case was a lost cause, so don't care if the precedent goes against collecting the tax that they don't consider due)

  16. Anonymous Coward
    Anonymous Coward

    He should have picked a more realistic number

    His reason for requesting a cap on his liability for Uber's fees is sound. To me, the issue is the size he requested. Given the size of his war chest he got from crowdfunding, and the amount he earns himself, 20k is taking the piss. If he had gone in with a more realistic number like 250k he may have got somewhere.

    On the basis that he would be able to do the work "for free" while living off the crowdfunding money, and uber would probably get one lawyer for two weeks for 20k, it seems he was trying to hamstring uber in a similar way to what this legislation is intended to prevent, rather than using it to create a fair fight.

    1. DavCrav Silver badge

      Re: He should have picked a more realistic number

      "20k is taking the piss. If he had gone in with a more realistic number like 250k he may have got somewhere."

      Why? You don't need thousands of hours of legal time to explain why you aren't subject to VAT. Unless you really are, and you are busy leafing through lawbooks, trying to wriggle out of reality.

  17. John Sager

    It's worth reading Guido Fawkes on this guy. Whatever you think of Uber and their business practices, Maugham does seem to come across as a poor version of Don Quixote for the millennium, and quite keen on getting crowdfunders to pay for his little tantrums.

    1. Loyal Commenter Silver badge

      It's worth reading Guido Fawkes on this guy.

      If you like your political commentary somewhat right-of-right-of-centre, yes.

    2. This post has been deleted by a moderator

  18. Wolfclaw Silver badge
    Happy

    Win Win for all, Uber can get stung for big VAT bill, lawyer can get stung for big legal bill,. oh happy days !

  19. Rudolph Hucker the Third

    c/o Guido Fawkes

    The judge rejected both Maugham’s ‘Protective Costs Order’ and his initial appeal, which would have limited Jolyon’s liability to just £20,000 if he lost the overall case, instead of being on the hook for Uber’s costs which could be over £1 million. The judge noted that the “named claimant has significant assets which he is not prepared, albeit for understandable reasons, to expose to the risk of an adverse costs order.”

    More significantly, the judge said the fact that Jolyon had received “substantially more than 50% of the funding” from his case from the black cab trade, including one single contribution of £20,000, was very much a “relevant consideration” in the case.

    The effect (had he won the case) would be (a) allow him to claim the VAT as a business expense and (b) put up the price by 20% for the general public (that's most of us)

    1. gazthejourno (Written by Reg staff)

      It's very nice of you to copy-and-paste from a light rewording of my original article, which you had to click in order to get here.

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