Q&A: VAT implications of DELTA Merseyside v Uber

DELTA Merseyside Limited and another v Uber Britannia Limited [2024] EWCA Civ 802 is the latest in a string of decisions concerning the regulatory regimes for private-hire vehicle operators (PHVOs) in London under the Private Hire Vehicles (London) Act 1998 (PHVLA 1998) and outside London under the Local Government (Miscellaneous Provisions) Act 1976 (LGMPA 1976).

While these cases do not address VAT matters they have important implications for the VAT treatment of PHVOs.

The DELTA case considers if LGMPA 1976 requires PHVOs to contract with passengers at the time of booking as principal. Many PHVOs operate as agent or intermediary for drivers which means that the PHVO is only liable to account for VAT on the commission or booking fee they retain. If the agency model is incompatible with LGMPA 1976 then some PHVOs operating outside London may have...