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Centrelink & COVID Payments for Uber and Rideshare Drivers
Updated Sunday 19th of June 2022
New: Updated list of which COVID payments must be declared in your 2022 tax return.
Thankfully the worst of the pandemic lockdowns appear to be behind us. As we head into Tax Time for 2022, the most relevant question for rideshare and delivery drivers right now is figuring out which government COVID, isolation and quarantine payments have to be declared in your 2022 tax return.
Below you’ll find all the current pandemic-related information for drivers in Australia, including which government grants and COVID payments are taxable and which aren’t, and where to declare JobKeeper, JobSeeker and Disaster Payments in your 2022 tax return. You’ll also find instructions for how to report your Uber, rideshare or delivery income to Centrelink.
- Is My COVID Grant or Payment Taxable?
- Applying to Centrelink as an Uber Driver
- Entering JobKeeper in your DriveTax Spreadsheet
- Other Financial Assistance for Uber Drivers
We’ve listed here a summary of the ATO, Centrelink and Government payments made over the course of the pandemic, and whether you have to declare the payment in your 2022 tax return.
- Business Grants on the ATO Exemption List – Not Taxable – the ATO have declared a number of state government grants to be tax-free, which means they do not have to be declared anywhere in your tax return. The most common ones for Uber drivers are listed below, and you can find the full list here. GST does not apply so you will not enter them anywhere in your BAS. If you use the DriveTax Spreadsheet you don’t need to enter these at all.
- ACT COVID-19 Business Support Grant
- NSW 2021 COVID-19 Business Grant
- NSW 2021 COVID-19 Micro-Business Grant
- NSW 2021 COVID-19 JobSaver Payment
- NSW 2022 Small Business Support Program
- QLD COVID-19 Business Support Grants
- SA COVID-19 Business Support Grant
- SA COVID-19 Additional Business Support Grant
- SA COVID-19 Business Hardship Grant
- VIC Business Continuity Fund
- VIC Business Costs Assistance Program Round 2
- VIC Business Costs Assistance Program Round 2 – July Extension
- VIC Business Support Fund 3
- VIC Small Business COVID Hardship Fund
- VIC Sole Trader Support Fund
- Business Grants NOT on the ATO Exemption List – Taxable – if your grant does not appear on the list above then it is taxable and must be declared in your tax return. If you use the DriveTax Spreadsheet and have the 2021 version, enter these payments in the orange section under ‘Government Grants, no GST, income tax applicable’ (contact us for help with previous spreadsheet versions). To declare this income in your tax return, enter it in the Business Schedule at the label ‘Assessable Government Payments’. GST does not apply to these grants so you will not declare these payments in your BAS’s.
- Centrelink COVID Disaster Payment – Not Taxable – this payment was for people who couldn’t work due to lockdowns or regulations, and acted as a replacement to JobKeeper for a while. It took the form of a regular ongoing payment or the period of time you couldn’t work. You do not need to include this payment anywhere in your tax return. The ATO changed their minds about the taxability of this payment, so for payments received in the 2021 financial year, if you already lodged your 2021 tax return and included this payment in your income, you can amend your tax return to remove it. GST does not apply, and it is not declared anywhere on your BAS. Do not enter these in the DriveTax Spreadsheet as they are personal, not business.
- Centrelink Pandemic Leave Disaster Payment – Taxable – this payment was for people who had to self-isolate or quarantine, or who had to care for someone with COVID. The amount was $750, and for longer quarantine periods you may have been eligible for two payments. If you are lodging your tax return on MyGov this amount should be declared at the label Australian Government Special Payments, or if you are lodging by paper or through a tax agent it is declared at Item 24. GST does not apply, and it is not declared anywhere on your BAS. Do not enter these in the DriveTax Spreadsheet as they are personal, not business.
- Vic and NSW Test Isolation Payments – Taxable – this was a one-off payment for people who lost income while waiting for the results of a PCR test. The amounts were $450 in Victoria and $320 in NSW. If you are lodging your tax return on MyGov this amount should be declared at the label Australian Government Special Payments, or if you are lodging by paper or through a tax agent it is declared at Item 24. GST does not apply, and it is not declared anywhere on your BAS. Do not enter these in the DriveTax Spreadsheet as they are personal, not business.
- JobSeeker – Taxable – you will receive a payment summary from Centrelink for any JobSeeker you received, and it will prefill automatically into your tax return under Australian Government Allowances & Payments. GST does not apply to JobSeeker so you will not declare these payments in your BAS’s. Do not enter these in the DriveTax Spreadsheet as they are personal, not business.
- JobKeeper received as a Sole Trader (2020 and 2021 financial years) – Taxable – you can view your taxable amount on your ATO income report in MyGov, or you can calculate it manually by referring to your bank statements. In terms of timing, you should only include amounts that landed in your bank account from 1 July to 30 June. This means you must include the JobKeeper payment that was related to the last fortnight in June but landed in your bank account in July. If you use the DriveTax Spreadsheet you will see specific cells in the orange section to enter your JobKeeper income. In your tax return, enter your sole trader JobKeeper payments in the Business Schedule at the label ‘Assessable Government Payments’. GST does not apply to JobKeeper so you will not declare these payments in your BAS’s
- JobKeeper received as an Employee (2020 and 2021 financial years) – Taxable – if you received JobKeeper through your employer it will be included in your regular payment summary, and is treated just like regular employee income. This will prefill automatically into your tax return.
JobSeeker is very complex, and there are too many details and variables for me to cover everything. So in this blog post I will focus on the initial application process and on how to fill in a Centrelink Profit & Loss. For general information about JobSeeker, including payment rates, eligibility and how to apply, please visit Centrelink’s website.
Centrelink & JobSeeker Initial Application for Uber Drivers
If you are applying for the JobSeeker Payment, you’ll be asked to provide a number of documents, including a Profit & Loss, Balance Sheet and Depreciation Schedule.
My main tip here is that Centrelink understand that the application process is difficult for very small businesses. They don’t expect you to know all the tax laws yourself, and it’s not their intention to force you to pay for an accountant to help you, that would be counter-productive! So please don’t be worried, it’s okay to just fill out the forms as best you can, and if they have further questions for you they will ask you.
Here are a few quick tips about the initial application. For Profit & Loss form tips scroll down to the next section:
- Employment – note that Uber and UberEats are NOT employment, so do not write Uber as your employer. For employment, you must only include jobs where you were an employee under your TFN.
- Business –
- If you do Uber, rideshare or food delivery, then this is classed as Business.
- In the preliminary questions you should answer that you’re involved in one business in Australia (or more if you have other income on your ABN aside from rideshare/food delivery), and that you do not operate through a company, you are a sole-trader.
- For the question asking if you’re still trading, answer yes if you’re still driving even a little and enter your hours accordingly. If you’ve stopped driving altogether you can answer no, but you will be asked to provide evidence, which will mean cancelling your ABN and GST Registration. You can do this by calling the ATO on 13 28 66. Then once your ABN record has updated on the Australian Business Register you can save a PDF of this screen and upload it to Centrelink.
- The last question in this section asks if your income has changed since your last tax return. If your Uber income has decreased because of COVID you should answer yes. Or if you’re a new sole-trader you should also answer yes.
- Income & Expenses – For instructions on reporting your income and expenses please scroll down below to the section ‘How to Complete a Centrelink Profit & Loss’.
- Assets & Liabilities – if you have the option to skip this do try to skip it, as it’s really only for larger businesses and not relevant to rideshare and food delivery drivers. But if Centrelink insist, just type these into a plain document, save it as a PDF, and then send it to them
- If you own your car you will list it as an asset, and if you have a loan you’ll list that as a liability. For most Uber drivers these will be the only items in your Assets and Liabilities list.
- If you rent or lease your car then you do not own it, so don’t include it in your list.
- If you have outstanding ATO debts these are also liabilities but don’t include any tax returns or BAS’s you haven’t lodged yet.
- If you keep a bank account that is 100% for Uber then you should include it as an asset, but don’t include personal bank accounts.
- No need to list small assets such as your mobile phone.
- So to summarise, for most people this will be a one-page document as follows, very very basic!:
- Assets & Liabilities (heading at the top)
- Your Name (sub-heading at the top)
- Assets –
- Bank Account – $xxx (only if you have a dedicated bank account for business, otherwise skip this)
- Motor Vehicle – $xxxx (this is the current approximate market value of your car, but only if you own it, not if you rent/lease)
- Liabilities –
- Motor Vehicle Loan – $xxx (only if you have one, otherwise skip this)
- Depreciation Schedule – This question is more for bigger businesses with lots of assets such as retail stores or construction companies, it’s not so important for a very small business with only a car. If your car was depreciated in your last tax return and you have a copy handy, answer yes when they ask you if you have a depreciation schedule and send them that page from your tax return. If not, just answer no that you do not have a depreciation schedule.
- Balance Sheet – answer no to this question, the ATO doesn’t require micro-businesses such as rideshare drivers to generate Balance Sheets.
If Centrelink have asked you to fill out their Profit & Loss Form, here are some tips to help you.
Again, my main tip here is that it’s not Centrelink’s intention for this to be difficult, or to force you to pay for accounting fees just to access government support. So it’s completely okay for you to just do your best, it doesn’t have to be perfect. This is especially true if your income is well below the relevant thresholds and your eligibility is clear.
Our fee for a Centrelink P&L is $150, but honestly, my recommendation for everyone is to try it yourself first, don’t overthink it too much, and see if Centrelink are happy with it. We will always be here for you as a backup if you need, but hopefully these tips below will save you from having to pay accounting fees!
- Dates – Centrelink should tell you which dates they want you to report for, as it may be a month or a quarter or a year. Enter the dates at the bottom of page 1 at question 10.
- Sole Trader – for the vast majority of rideshare drivers this will be yes.
- Gross Income – This is entered at the very top of page 2 on Centrelink’s form, Label A.
- Rideshare & Food Delivery Income – Add up the total payments you received in your bank account from Uber and any other companies you drove/delivered for in that period. If you are registered for GST then divide your total by 1.1. If you are not registered for GST then do not divide.
- Other Income – if you earn other income on your ABN then include it here. If you are registered for GST then divide your total by 1.1. If you are not registered for GST then do not divide. Do not include employee income earned under your TFN.
- Expenses – note that most of these won’t apply, you’ll just leave them blank. I have noted the particular expenses below that might apply for rideshare and food delivery drivers.
- Depreciation – Depreciation is the most difficult question on this form because it has to be calculated using a particular method (Division 40) that’s quite involved. If your car is older and the depreciation is quite low, or if you know you’re going to be below all the thresholds to get your Centrelink payment even without claiming the depreciation, then you may like to skip this question altogether and just write $0. But if you do really need to minimise your profit on your form in order to get your Centrelink payment then you can calculate your depreciation using this ATO calculator.
- Select ‘Individual’, click on ‘Add’,
- In the ‘Description’ field write your vehicle make and model, and then in ‘Type’ click on ‘Work-Related Car Expenses’. This will ensure that we are using the particular type of depreciation calculation method that is required by Centrelink.
- ‘Date Acquired’ and ‘Date Asset Started To Decline’ are both just your car’s purchase date.
- Skip the next few items and go down to ‘Effective Life in Years’ and type 8
- Answer No for ‘Has The Asset Been Sold’, and then for the Method choose ‘Diminishing Value’, and finally answer no to the last three questions.
- You now should see the depreciation table pop up.
- One important last step – just above the table you’ll see the Taxable Use Percentage. Click edit, type your Uber percentage in here, and save.
- Click Save at the bottom and you’ll be taken to a summary page where you can print your Depreciation Schedule. Save this somewhere handy for next time you have to fill in your Profit & Loss.
- To find the right figure to fill into your P&L form:
- If you bought your car in an earlier financial year, just look for the current financial year in your table and go across to the column ‘Deductible Decline In Value’. This is your depreciation for the full 12 months, enter this into the ‘Annual Amount’ column. Then divide it by the number of months your P&L is covering. So if for example you’re reporting one month worth of income and expenses, you’ll write both your whole year’s depreciation and then your depreciation divided by 12. Or if you’re reporting for 3 months (i.e. a quarter of a year) then divide by 4. Enter this into the ‘Amount for Period of Statement’ column.
- If you bought your car during this financial year you will need to do one more calculation.
- In your depreciation table, your car’s first-year depreciation for the current financial year will be the top row. Go across to the column ‘Deductible Decline In Value’ and grab that figure. On your Centrelink form, fill this into the ‘Annual Amount’ column for depreciation.
- Next, work out how many months for this financial year that you owned your car. For example if you bought it in October then October-June is 9 months. Or if you bought it in February then February-June is 5 months. Let’s call this (A)
- Also, note how many months that Centrelink is asking you to report for. Usually it will be either 1 month or 3 months. Let’s call this (B)
- To calculate your depreciation ‘Amount for Period of Statement’, take your ‘Annual Amount’, divide it by (A) and multiply by (B).
- Congratulations, that’s the hardest part of the Centrelink P&L form done!
- Insurance – in the first column enter your total yearly car insurance multiplied by your business percentage, and if you are GST registered then divide by 1.1. Then in the second column just enter the portion for the period of time you’re reporting for on your Centrelink form. (E.g. for 3 months, divide by 12 and multiply by 3)
- Interest – if you have a car loan you’ll need to check your account for your interest. Don’t forget to adjust for your business use percentage. Put the yearly total in the first column, then divide for the period of time you’re reporting for in the second column.
- Levies, Licences & Fees – for Uber drivers this might include driver authorisations, licenses, permits and so on. Enter your annual totals in the first column, and then divide for the period of time you’re reporting for in the second column.
- Registration – your car registration multiplied by your business percentage. Enter your annual total in the first column, and then divide for the period of time you’re reporting for in the second column.
- Rent and Rates – this does not apply to Uber drivers. Do not include your home here. This is only meant for retail stores or workshops who rent shops, factories or commercial premises.
- Motor Vehicle Running Costs – add up all your fuel, maintenance, and any other car expenses not included above from your bank transactions and multiply by your business percentage. If you rent your rideshare vehicle, include it here too. (If you have a loan, do not include your repayments here, instead enter your interest and depreciation as above.) If you are GST registered then divide GST expenses by 1.1,
- Telephone – your mobile phone bills multiplied by your business use percentage (just an estimated percentage is fine), and if you are GST registered then divide by 1.1.
- Other – this may include tolls (but only tolls between trips, the tolls while on trips are already included in your Uber payments), water, mints, and any other Uber related expenses. If you are GST registered then divide any GST expenses by 1.1. In the blank row on the left write the names of the main expenses you have included here, but don’t worry if they don’t all fit. Then write the total in the right-hand column.
- Expenses You Can’t Include – donations, personal health or life insurance, superannuation contributions, coffees, meals, clothing, personal expenses, fines, carried forward losses, or the purchase price of a car.
The only pandemic payments that should be entered in your DriveTax Spreadsheet are JobKeeper (but only if paid to you as a sole trader, not JobKeeper through your employer), and any business grants that are not tax-exempt. See above for the full list of tax-exempt business grants.
Spreadsheet Version 2020.06 & later – The newest versions of the spreadsheet, those released in June 2020 and June 2021, have been updated to include JobKeeper. You’ll find this in the lower half of the orange section of the spreadsheet. There are two important rules to keep in mind:
- Timing of Payments – JobKeeper payments are recognised by the ATO on the date you receive the payment. It doesn’t matter if the payment relates to earlier fortnights or months, it only matters which date it arrived in your bank account. For example, you received payments for fortnights 5 and 6 which were in June 2020, and the payment reached your bank account in July 2020. You should enter this in the July JobKeeper field of your 2020-2021 spreadsheet, and it is declared in your 2021 tax return.
- Don’t include Employee JobKeeper – if you received JobKeeper from an employer, do not include it in your spreadsheet. Only JobKeeper payments you received as a sole trader under your ABN must be included.
In the 2021.06 spreadsheet you’ll also find a specific field for Business Grants. As mentioned above, many grants are tax-exempt, so check the list above to see the ruling on your particular grant. For grants that are exempt, you will find a specific field for these in the lower half of the orange section of the spreadsheet, but it’s not actually necessary to enter this, you can skip it altogether. If your grant is taxable, enter it in the field for taxable business grants. The spreadsheet will include it in your end of year tax summary but not in your BAS.
Spreadsheet Version 2020.02 – When I built the previous version of the spreadsheet back in February, I couldn’t have guessed something like coronavirus and JobKeeper, so unfortunately the spreadsheet isn’t built to manage a payment like this! But that’s okay, you do not have to change spreadsheets. Just manually enter the JobKeeper payment into your tax return using the instructions above. I recommend that you keep using your existing spreadsheet until 30 June and then switch to the new version from 1 July. (You should have received the new version via email in late June, please email me if you didn’t receive it).
If you don’t already have the DriveTax Spreadsheet, jump up to the very top of the page and enter your email address to get your free copy!
Please note that the ATO always requires you to lodge your BAS’s and tax returns on time, even if you’re not able to pay right away. The ATO are generally happy to put payment arrangements in place that will work for you in your current circumstances, but first you must submit your lodgements on time and have no overdue BAS’s or tax returns.
Here are the links to our BAS Lodgment and Tax Return Lodgment pages. I’ll be fast-tracking our services for anyone who needs their BAS or tax return lodged in order to access Centrelink benefits ASAP.
If you’re not able to lodge your tax return or BAS because you can’t afford to pay accountant’s fees right now, the ATO will understand. Call the ATO’s Emergency Support line on 1800 806 218 before the due date and chat to them about alternative arrangements.
Standard Payment Arrangements
You can set up a standard payment arrangement for any tax bill via your MyGov or by calling the ATO’s automated service. A standard payment arrangement requires you to pay 10%-20% upfront and then the rest over a period of up to two years.
If you need more time to pay due to COVID-19, you can call and talk to the ATO. They may be able to offer deferred due dates for payments, and also low interest or interest-free payment arrangements. You will need to call the ATO’s Emergency Support line on 1800 806 218.
If you have to pay PAYG Instalments as part of your quarterly BAS, but your income is now lower, you can reduce your PAYG Instalments, and in some cases claim back instalments for previous quarters. We can help you with this as part of our Express BAS service.
If your income has not reduced, but you need cashflow relief now, you can call the ATO’s Emergency Support line on 1800 806 218 and ask them to withdraw your PAYG Instalments. However you will still need to pay the tax eventually on your end of year tax return.
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.
Jess is on a mission to make taxes straightforward and manageable for Uber drivers across Australia.
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.