Ridesharing in Australia has become extremely popular in recent years, promoting Uber as a new way to earn an income. With this newfound income comes taxation.
If you are an Uber driver in Australia, you may have wondered, does Uber pay tax in Australia? In this article, we will provide an in-depth Uber driver tax guide, to ensure you meet your Uber tax return obligations for the financial year.
Register for an Australian Business Number (ABN)
When working as an Uber driver, you are required to have an ABN. An ABN is used to uniquely identify your business and is important for tracking your transactions for tax purposes.
Register for Goods and Services Tax (GST)
If you are set to earn more than $75,000 for the year as an Uber driver, you are required to register for goods and services tax. When you are registered for GST, you will be required to withhold 10 per cent of your income.
Uber drivers earning less than $75,000 for the year are not required to register for GST.
What do Uber drivers need to report as income?
As an Uber driver, you are required to report all the income you earn whilst driving for Uber. This includes income from fares and tips that you receive throughout the year.
You can access your annual tax summary that includes your gross earnings and potential expenses with the following steps:
- Log into your Uber account
- Click on Tax Summary
- Choose the relevant statements.
What can Uber drivers claim as Uber tax deductions?
Uber drivers are only able to claim the proportion of expenses that are used for work. For example, if you use your car for 20% personal use and 80% for work-related use, you can only claim 80% of the costs that were incurred.
Some of the Uber tax deductions you can claim as an Uber driver include the following:
- Depreciation of your car
- Fuel costs
- Car repairs and maintenance
- Parking fees and tolls
- Uber fees
What records are Uber drivers required to keep?
Uber drivers are required to maintain records for the year to prove the income and expenses claimed are accurate. Some of the records to keep include some of the following:
- Bank statements
Keeping records of your bank statements can be useful to prove your income and expenses for the year.
Keeping receipts is important to prove your expenses that have been incurred. To claim your tax deductions for Uber you are required to keep your receipts.
- Kilometres travelled
Tracking your distance travelled for work-related reasons gives you a better understanding of the proportion of costs incurred for work-related purposes as well as personal use. Remember, you can only claim the proportion of costs incurred for work-related reasons.
- GST records
If you earn over $75,000 for the year, you are required to keep your GST records. You need to keep records that prove the amounts reported to claim GST credits.
To track the proportion of vehicle expenses incurred for your Uber driving, you can use the logbook method or the cents per kilometre method.
- Logbook method
Track the kilometres travelled and the proportion of costs that you have incurred for your business.
- Cents per kilometre method
Track the kilometres travelled and use a rate of 78c per kilometre (2023) to claim your expenses.
File your taxes
Once you have gone through the steps of the Uber driver tax guide, you are now ready to file your taxes. As you are considered a business, you are required to file your taxes before October 31 of every year. The short answer to the question, does Uber pay tax in Australia, is yes. Just like any other income-paying job, you are required to pay taxes. To access your income report, head to the Uber website. Once you have your income and expenses for the year, you are ready to claim your tax deductions for Uber.
One Click Life can assist you with your Uber tax return!
Need help to claim your Uber driver taxes? One Click Life allows you to complete your online tax return at the click of a button.
Using an online tax agent is the simplest way to complete your tax return. Why wouldn’t you use one if you could claim your online tax agent fees as a deduction on your tax return? We do more than just tax! One Click Life can help with your Mortgage, Health Insurance, and Will, so you can enjoy the important things in life.