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FREE 5-Day Email Course to learn the ATO’s Uber tax rules
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FREE Uber Tax Info Pack
> FREE 5-Day ‘Uber Tax Essentials’ eCourse
> FREE Uber Bookkeeping Spreadsheet
> FREE Uber Logbook Spreadsheet
> FREE ABN & GST Registration
Seven Steps To Sorting Your Uber Tax Obligations
If you’re thinking of becoming a rideshare driver, one of your biggest questions is likely about how to manage your Uber taxes. Uber is a great way to earn extra money on your own terms. But driving for Uber and other rideshare and food delivery companies does come with some complicated tax obligations. If you’ve never had an ABN or run your own business before then Uber taxes can be daunting.
DriveTax are the leading Uber accountants in Australia, and we’ve crafted the ultimate guide to handling your tax obligations with Uber.
Seven Steps to Managing Tax for Uber Drivers
- Get an ABN
- Register for GST (rideshare drivers only)
- Keep records of your expenses (don’t worry about income, you’ll be able to download reports for that)
- Keep a logbook, essential if you want to claim tax deductions for your car
- Put aside some of your earnings to save for your GST and Income Tax bills
- Lodge BAS’s quarterly to pay GST (rideshare drivers only)
- Declare your Uber income on your end of year tax return to pay Income Tax
Let’s look at these in a bit more detail.
1) Apply For An ABN, and 2) Register For GST (Rideshare Only)
First things first. All rideshare and food delivery drivers must have an ABN, and all rideshare drivers must register for GST.
Uber drivers must register for GST because the ATO have special GST rules for taxi drivers, whereby the usual $75,000 GST registration threshold doesn’t apply. They’ve determined that Uber drivers, and by extension all rideshare drivers, meet their definition of a taxi driver, being someone who drives passengers from A to B for money. This means that all rideshare drivers in Australia must register for and pay GST from the first dollar they earn, even if they only drive occasionally.
Getting an ABN and GST Registration for Uber is free and very simple. Our FREE ATO Registration service, which is part of our Free Uber Tax Info Pack, will take care of your ATO application for you, and you’ll have your ABN and GST Registration within two business days.
Many drivers have asked ‘What if I don’t register, how will the ATO know?’ We now know for sure that the ATO have access to information about who is driving for Uber, unregistered drivers have been receiving ATO letters demanding they register immediately and pay the required tax. No doubt they’ll be able to access the same information for other rideshare drivers too. If you’re not registered for GST and paying tax, you can expect to hear from them.
One last point, if you already have an ABN, you must use that same ABN for Uber. Likewise, if you’ve had an ABN in the past, it must be reactivated. This is because each person only ever gets one ABN which is used for all their business activities throughout their lifetime. The bad news is that if you’re currently earning business income from other sources you will have to charge GST and pay GST on ALL of your business income, not just your rideshare income, even if you earn less than $75,000. If you need more information on this, please contact us.
3) Keep Records Of Your Uber Expenses
The best way to maximise your tax deductions and minimise tax is to keep good records. You can use whatever system works best for you, whether it’s software, a spreadsheet or a shoebox.
For fuel receipts, try keeping an envelope in your glovebox. You must collect all your fuel receipts, both business and private. Technically, for expenses under $82.50 you don’t need tax invoices and your bank statements are acceptable; tax invoices are only required for expenses over $82.50. However we recommend keeping all your receipts anyway to make them easier to add up and make sure you don’t miss any deductions.
You’ll also need to collect your receipts for insurance, registration, repairs, servicing, cleaning, tolls, mobile phone bills, rider amenities (water, mints etc) and anything else that relates to your driving. An expanding file works well for this, with each section labelled as a different category. You should also create a tax receipts folder on your computer or in your email inbox to keep any receipts you receive digitally. You don’t need to print them, the ATO does accept digital copies.
For your income, there’s no need to keep records. Instead you’ll be able to download reports showing your income from your online account. The same goes for the fees you pay them. You’ll just download reports each quarter showing your income for your BAS, and another report for your tax return at the end of the financial year.
At the end of each quarter you’ll need to add up your total expenses for each category in order to lodge your BAS. We explain this process in more detail in our Ultimate Guide to Uber BAS’s. The best way to track and add up your expenses is the FREE DriveTax Uber Spreadsheet. It’s custom designed for all the major Australian rideshare companies, and it will calculate the GST on all your expenses for you to make lodging your Uber BAS a breeze. Download your copy here.
4) Keep A Logbook For Your Uber Driving
For GST purposes a logbook isn’t required. You can make a reasonable estimate of the percentage you use your car for business, based on your rideshare company’s online reports and data, car service records and other information. You can then claim this percentage of the GST back on all your vehicle expenses.
End of year tax is a different story. To claim a tax deduction for your car’s actual running costs, you must keep an ATO compliant logbook:
- It must go for 12 continuous weeks. If you start driving less than 12 weeks before the end of the financial year you can continue the logbook into the next financial year as long as you start before 30 June.
- You must record the date and the odometer reading at the start and end of the 12 weeks
- For every rideshare session, you must record the date, and your beginning and ending odometer readings.
- You can include your travel from home to your first passenger, from your last passenger back home, and the kms in between passengers too. (This is different to the usual employee rules, when you’re self-employed the journey to and from home is tax deductible too). This means you just need to record your odometer once when you leave home and once when you arrive home, no need to record individual trips.
The Free DriveTax Spreadsheet includes a Free ATO-compliant Uber Logbook Spreadsheet which does all the adding up and percentage calculations for you. If you prefer a physical paper logbook we recommend the Zions Pocket Vehicle Logbook from Officeworks for under $7. You can also use an app, but you must still manually record your odometer readings at the start and end of every tips, as an app can’t read your odometer for you.
If you don’t keep a logbook, you cannot claim any of your car expenses on your tax return. Instead you’ll be limited to using the cents per kilometre method. This gives you a maximum of 5,000kms x 68 cents per km, equalling a maximum deduction of $3,400. If you only drive occasionally, and you feel this covers your car expenses, then feel free to skip the hassle of a logbook and choose this method instead. But if you drive regularly, this deduction could be much less than your actual expenses, and could leave you with a larger tax bill. A logbook is a pain, but it will ensure you’ll get the maximum deduction you’re entitled to.
5) Put Aside Part Of Your Income To Save For Your Tax Bills
There are two types of tax you must save for and pay, GST and Income Tax.
Each time you get paid, you’ll need to put away a percentage of what you earn, so by the end of the quarter you’ll have enough money to pay your GST, and by the end of the year you’ll also have enough to pay your income tax bill. We recommend setting up a savings account especially for your rideshare tax bills, preferably one that will earn you some interest along the way.
Working out how much to put aside is tricky, as it varies from one driver to the next. Check out our blog post on Saving for your Uber GST and Tax Bills for more detail.
6) Pay Your Uber GST Quarterly on your BAS (Rideshare Only)
Your Business Activity Statement (BAS), is where you’ll report your quarterly rideshare income and expenses. You’ll then pay your Uber GST bill, which is the GST on your income minus the GST on your expenses, to the ATO. You can lodge your BAS yourself either on MyGov or via a paper form, or you can lodge your Uber BAS through DriveTax or another tax agent.
Here are the BAS quarters and due dates:
|Q1 – September Quarter||Q3 – March Quarter|
|1st July – 30th September||1st Jaunary – 31st March|
|• Lodge yourself – paper form – 28th October||• Lodge yourself – paper form – 28th April|
|• Lodge yourself – MyGov – 11th November||• Lodge yourself – MyGov – 11th May|
|• Lodge with Tax Agent – 25th November||• Lodge with Tax Agent – 25th May|
|Q2 – December Quarter||Q4 – June Quarter|
|1st October – 31st December||1st April – 30th June|
|• Everyone – 28th February||• Lodge yourself – paper form – 28th July|
|• Lodge yourself – MyGov – 12th August|
|• Lodge with Tax Agent – 25th August|
Q1 – September Quarter
1st July – 30th September
• Lodge yourself – paper form – 28th Oct
• Lodge yourself – MyGov – 11th Nov
• Lodge with Tax Agent – 25th Nov
Q2 – December Quarter
1st October – 31st December
• Everyone – 28th Feb
Q3 – March Quarter
1st January – 31st March
• Lodge yourself – paper form – 28th Apr
• Lodge yourself – MyGov – 11th May
• Lodge with Tax Agent – 25th May
Q4 – June Quarter
1st April – 30th June
• Lodge yourself – paper form – 25th July
• Lodge yourself – MyGov – 12th Aug
• Lodge with Tax Agent – 25th Aug
For a more detailed explanation of BAS’s, visit our Ultimate Guide to BAS for Uber Drivers.
If you need help lodging your BAS, our Express BAS service is the easiest and quickest way to lodge your Uber BAS online. We process your BAS within two business days, and we make sure all your GST claims are maximised. Visit our BAS Services page for more information. Or if you’d like to learn how to lodge your own BAS, our Understanding Uber Taxes online course teaches you step-by-step.
7) Pay Your Uber Income Tax On Your Tax Return
At the end of the financial year you’ll declare your Uber income and expenses on your end of year tax return, and the ATO will calculate how much income tax you need to pay.
You’ll need to gather your income and expense totals in order to lodge your return. The income side of things is easy, you can download your tax summaries from the companies you driver for. To claim your expenses you’ll need to add up totals for the financial year of each category of expenses, or if you’re using the DriveTax Uber Spreadsheet this will already be done for you.
To learn about Uber taxes in more detail, including how the ATO calculates your tax bill, what tax deductions you can claim, and teh tax return due dates, visit our Ultimate Guide to Tax for Uber Drivers.
If you need help lodging your Tax Return, our DriveTax Express Tax service is the best choice. You can lodge your income and expenses online from the comfort of home, and our turnaround time is two weeks. Every tax return is processed personally by a CPA accountant (we never off-shore your tax return or use AI automation), and we chat to you via email throughout the process so you can be confident that every tax deeduction is maximised. Visit our Tax Services page for more information. Alternatively if you’d like to learn how to lodge your own Uber tax return on MyGov, our Understanding Uber Taxes online course teaches you how with step-by-step video tutorials.
So that’s it. Seven steps to completely manage your tax affairs as an Uber or rideshare driver.
8) The DriveTax FREE Uber Tax Info Pack
If you haven’t already, download your free Uber Tax Info Pack now. It includes these essential resources for any new Uber Driver.
- Free 5-day email course ‘Uber Tax Essentials’, which explains in detail everything you need to know right away as a new driver
- Free Uber Spreadsheet, custom built for rideshare and food delivery drivers. Also includes ATO Logbook Spreadsheet
- Free ATO Registration Service if you don’t already have your ABN and GST registrations set up.
You’ll learn everything you need to know from Day 1 to manage your taxes correctly.
Quick Hit List for New Drivers
As a final handy reference, if you’ve just started driving or about to start, here’s your immediate to-do list:
- Get an ABN and Register for GST with DriveTax with our free ATO Registration Service
- Download your free Uber Tax Info Pack to learn the essentials of how to manage your taxes PLUS a free Uber Bookkeeping Spreadsheet
- Find a large envelope to keep in your glovebox for fuel receipts and an expanding file for receipts at home
- Keep a logbook so that you can maximise your car deductions
- Open a savings account with your bank to help you save for your tax bills
- When it’s time to lodge your BAS and tax return, visit our BAS Services page and Tax Services page
- If you’d like to learn more about how to manage your Uber and rideshare taxes, check out our Understanding Uber Taxes online course
All the best with your driving!
Thoughts? Questions? Leave a comment below and I’ll respond shortly! – Jess
The information in this article is general in nature and does not take into account your personal circumstances. If you’d like to know how this article applies to you, please contact us to arrange a consultation, or talk to your accountant.
About the Author – Jess Murray CPA – Uber Accountant
Jess Murray is a CPA Accountant and registered tax agent. She’s been working in personal and small business tax for 13 years, and has been specialising in tax for Australian Uber Drivers for the last 5 years as the Director of DriveTax. She also teaches an online course called Understanding Uber Taxes.
Jess is on a mission to make taxes straightforward and manageable for Uber drivers across Australia.