Uber Challenges HMRC Over £1 Billion UK VAT Bill on Fares

Uber is in a major legal dispute with the UK tax authority, HM Revenue & Customs (HMRC), over a tax bill that could exceed £1 billion. The case concerns whether VAT applies to Uber’s UK fares and delivery sales.

The dispute centers on whether VAT should apply to gross fare revenue or only to Uber’s profit margin under the Tour Operators’ Margin Scheme (TOMS). A 2021 Supreme Court ruling classified Uber drivers as “workers,” making Uber the principal service provider and liable for VAT on fares.

Uber has paid the assessed VAT since 2022 and is appealing to recover the money. The company believes it will succeed.