[Australia] Uber wins dispute over payroll tax assessment

Earlier this month in Australia, Uber won a lawsuit disputing a New South Wales payroll tax assessment after the judge revoked an assessment of the 2015 financial year in the Supreme Court of New South Wales, Capital Brief reports.

The case was prompted by a payroll tax audit of Uber in 2018 for the 2015 financial year that led to a $81.5 million bill being issued to the ride share company in 2021.

Despite disputing the tax assessment, Uber had reportedly been executing a confidential payment plan agreed upon with the chief commissioner of state revenue.

The case centred on the question of whether the payments Uber drivers receive are “for or in relation to the performance of work”, or whether Uber is simply remitting money collected from passengers to drivers, acting as an agent of sorts.

Lawyers reportedly see it as a test of how 1980s tax laws apply to the modern gig economy and in particular, digital platforms.

In his September 6 judgment, Supreme Court of New South Wales Judge David Hammerschlag said Uber does not pay drivers wages but acts as a "payment collection agent", remitting money paid by riders.

Uber must account to the driver the money it receives as an agent, but by the time it does that, Judge Hammerschlag ruled, riders have discharged their obligation to pay the driver for their ride.

"There is undoubtedly some form of relationship between Uber’s payment and the work which the driver performed, not least of all because, had the driver not driven, there would no money for which Uber would have to account to the driver by paying the driver," he said.

"But I do not consider that that relationship is one which can fairly be described as being 'in relation to' the work.

"What the rider pays the driver is for or in relation to the work done by the driver. What Uber pays the driver is in relation to the payment Uber has received, not in relation to the work itself."

Source: Capital Brief via ABC news

(Quotes via original reporting)

Earlier this month in Australia, Uber won a lawsuit disputing a New South Wales payroll tax assessment after the judge revoked an assessment of the 2015 financial year in the Supreme Court of New South Wales, Capital Brief reports.

The case was prompted by a payroll tax audit of Uber in 2018 for the 2015 financial year that led to a $81.5 million bill being issued to the ride share company in 2021.

Despite disputing the tax assessment, Uber had reportedly been executing a confidential payment plan agreed upon with the chief commissioner of state revenue.

The case centred on the question of whether the payments Uber drivers receive are “for or in relation to the performance of work”, or whether Uber is simply remitting money collected from passengers to drivers, acting as an agent of sorts.

Lawyers reportedly see it as a test of how 1980s tax laws apply to the modern gig economy and in particular, digital platforms.

In his September 6 judgment, Supreme Court of New South Wales Judge David Hammerschlag said Uber does not pay drivers wages but acts as a "payment collection agent", remitting money paid by riders.

Uber must account to the driver the money it receives as an agent, but by the time it does that, Judge Hammerschlag ruled, riders have discharged their obligation to pay the driver for their ride.

"There is undoubtedly some form of relationship between Uber’s payment and the work which the driver performed, not least of all because, had the driver not driven, there would no money for which Uber would have to account to the driver by paying the driver," he said.

"But I do not consider that that relationship is one which can fairly be described as being 'in relation to' the work.

"What the rider pays the driver is for or in relation to the work done by the driver. What Uber pays the driver is in relation to the payment Uber has received, not in relation to the work itself."

Source: Capital Brief via ABC news

(Quotes via original reporting)