Get all your news in one place.
100’s of premium titles.
One app.
Start reading
AAP
AAP
National
Duncan Murray

Uber's $81m tax bill wiped as it doesn't 'pay' drivers

Uber acted as a "payment collection agent" rather than paying wages to its drivers, a judge found. (Joel Carrett/AAP PHOTOS)

Millions of dollars worth of payroll taxes levelled at Uber have been wiped out after a court found passengers, and not the rideshare giant, paid drivers for their services.

The San Francisco-based company's local subsidiary, Uber Australia, appealed to overturn six payroll tax assessments made by the NSW Chief Commissioner of State Revenue for the years 2015 to 2020 totalling more than $81.5 million.

Uber argued its transport services were provided directly by drivers to riders and existed under contracts between those parties, which were agreed to when users sign up to its app.

But in a decision with potential ramifications for taxes levied on other peer-to-peer services, NSW Supreme Court Justice David Hammerschlag on Friday ruled that Uber did not pay drivers a wage and dismissed the assessments and interest sought by state officials.

Uber acted as a "payment collection agent", distributing money paid by riders to drivers that could not be considered a wage, he found.

"It is not Uber who pays the driver," Justice Hammerschlag said in his ruling.

"The rider does that. What Uber pays the driver is in relation to the payment Uber has received, not in relation to the work itself."

Lawyers for the chief commissioner accepted drivers provided a transport service for riders, but they argued drivers also did the same for Uber.

In response, Uber argued that its system existed only as a marketplace through which drivers and riders could identify and "contract" with one another.

Justice Hammerschlag noted there were difficulties applying the relevant laws as they were devised long before services like Uber existed.

The parties can make applications for costs.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.