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UK Tax Tribunal Rules Bolt Only Required to Pay Marginal VAT on Ride-Hailing Services

  • The UK Tax Tribunal has ruled that ride-hailing firm Bolt will only need to pay VAT on the ‘marginal’ value taken by the operator, rather than the entire cost of the fare.
  • Bolt appealed against the UK’s tax authority, HM Revenue & Customs (HMRC), regarding the application of the Tour Operator Margin Scheme (TOMS) to its operations.
  • The ruling states that Bolt’s services fall within the scope of TOMS, which requires companies to apply VAT only on the margin of a trip.
  • This ruling could have implications for the ride-hailing industry as a whole, and may open the door for other companies to challenge the VAT payment structure.
  • Uber’s similar litigation on TOMS against HMRC is set to proceed in the first half of 2024.
  • The Tribunal Judge noted that passenger transport services are commonly provided by tour operators or travel agents, supporting the view that ride-hailing services should fall under TOMS.

Source: taxi-point.co.uk

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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