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The court determined that the payments Uber makes to its drivers do not qualify as “for or in relation to the performance of work” under the Payroll Tax Act 2007 of NSW.
As a result, these payments are not to be considered wages and thus the extended payroll tax provisions do not apply.
Finsure CEO Simon Bednar described the outcome as “an optimistic outcome in Finsure’s eyes.”
He said: “Similar to Uber, we are a service platform that distributes revenue from lender partners to the brokers in our network, all of whom operate as independent entities.
“While each case is to be judged on its own merit and not one case is reflective of our entire industry, we believe the Uber ruling will offer a clear example to help Revenue NSW better understand the aggregation business model, and not apply retrospective financial costs that will negatively impact ordinary Australians that rely on brokers to obtain a loan.”
Bednar further said that by challenging the assessment of Revenue NSW, it is “wanting to draw a line”.
“We have no doubt that other State Revenue offices are watching the outcome of the current cases with keen interest so a successful outcome for Finsure will no doubt dissuade further action and help prevent unfair financial charges that could cripple our industry,” Bednar said.
“It’s all still to be determined but I can tell you one thing for certain – Finsure is up for the fight.”
Both Finsure and Loan Market have been embroiled in long-running court cases in regard to the application of payroll tax to certain brokers.
In April 2024, the Supreme Court of NSW ruled in favour of Revenue NSW, with Justice Richmond’s judgment establishing that there does indeed exist a “relevant contract” between Loan Market and active brokers using its aggregation services.
As a result, payroll tax would become payable on payments channelled through Loan Market to individual operators barring any specific exemptions.
Executive chairman Sam White said in an update at the time of the ruling: “We believe this is completely wrong – our brokers are our customers, not our employees.
“It is a complicated case and judgment and we’ve spent the weekend closely analysing and dissecting the judgment with our legal team.”
However, the judge on 6 September reserved the judgment on final orders and costs, which are yet to be determined. Once final orders are issued, an appeals process will extend for 28 days.
[RELATED: Loan Market payroll tax ruling handed down]
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