The US-based ride hire and food delivery company had previously claimed it was exempt from paying VAT due to its drivers being classified as self-employed. Following landmark court rulings clarifying that its drivers were in fact workers with rights, it began charging 20% VAT in March.

Jo Maugham, director of Good Law Project, tweeted about the tax settlement: “Quite a lot – but still rather less than I had understood HMRC was asking for … I wonder whether Uber had already made payments on account?”

An HMRC spokesperson told The Guardian: “HMRC has concluded a tax dispute with Uber concerning VAT due in the UK. This is a good result for the UK taxpayer and one that we would have reasonably expected to achieve in the court, fully in line with our litigation and settlement strategy.

“HMRC never compromises on its view of the law in order to secure a tax agreement. We will not settle for any amount less than we would reasonably expect to obtain from going to court.”