UK Tribunal Halts Uber VAT Appeal Pending Bolt Case Outcome

The UK's First-Tier Tribunal (FTT) published a decision in one of the most valuable UK VAT cases, resolving whether Uber’s private hire transport services should be taxed under the Tour Operators Margin Scheme (TOMS), a dispute parallel to the ongoing Bolt case. The importance of this case will be reflected not only in how these services are taxed, but also in what happens to the HMRC GBP 1.446 billion VAT assessment.

Background and Impact of the Case 

In 2023, Uber appealed the HMRC's VAT assessment requiring a statutory deposit of GBP 1.446 billion. HMRC asked that Uber’s appeal be put on hold, arguing that the outcome of the Bolt case would significantly shape the legal questions in Uber’s own dispute and that pausing the process would be the most efficient way forward. However, following the Bolts' success before the Upper Tribunal Tax (UTT), Uber argued that its deposit should be repaid, since the legal tide currently appears to favour taxable persons.

When making a decision, the FTT had to weigh the fact that Bolt is not yet final, since HMRC has taken the matter to the Court of Appeal, against the enormous amount at stake and the Treasury’s interest in safeguarding revenue during a difficult economic period.

The FTT noted that the statutory regime aims to prevent abuse of the appeal process while also ensuring a genuine appeal is not stifled by the obligation to pay disputed tax. It also added that in Uber's case, there is no risk that its right to appeal would be undermined for financial reasons, so hardship was not established. 

On the matter of fairness, the FTT acknowledged Uber’s considerable commercial disadvantage in being prevented from accessing such a large sum. However, considering that the Bolt case is not concluded, HMRC’s caution is reasonable given the scale of the revenue at stake. Therefore, the fact that Uber is likely to be able to pay VAT liabilities if the dispute losses does not outweigh HMRC’s legitimate concern to protect the revenue until the outcome becomes clear.

Conclusion

Ultimately, the FTT ruled that HMRC’s position should prevail and therefore ordered that Uber’s appeals remain on hold. The stay will last for 35 days after the Bolt case is fully resolved at all appeal levels, with all associated deadlines extended. However, one thing is sure: together, the Bolt and Uber cases may establish a significant precedent and potentially bring billions into the UK budget.

Source: The National Archives - Uber London Limited v The Commissioners for HMRC, VATabout - Bolt Wins VAT Case: UK Tribunal Ruling on TOMS Impacts Ride-Hailing Platforms