Tax Return:: Tax Return for Ride-Sourcing Drivers and GST Reporting

Hello, this is your tax and super specialist, P&C Tax Professionals.

Becoming a ride-sourcing driver may be an excellent way to earn some extra money but you must be aware of the tax implications that will apply to ride-sourcing drivers in order to avoid ending up with a massive tax debt at the end of the financial year.

<Introduction>

An important concept to keep in mind when it comes to ride-sourcing drivers is that they are not considered an employee of a company, but rather a contractor. This means that no taxes will be withheld from the income that you make and drivers would solely be responsible to manage their own tax affairs.

ATO’s tax implications for ride-sourcing drivers (e.g., Uber, Didi, Ola drivers) in simple terms are as follows:

> Every dollar you make from driving is included as income which you would need to declare on your annual tax return. For example, income from fares, tips, or bonuses are all considered assessable income.

> Regardless of whether you earn more or less than the $75,000 income threshold for GST if you are a ride-sourcing driver, you MUST register for GST.

> Since you are registered for GST, you must lodge your quarterly Business Activity Statement (BAS) by the deadline

<Paying your Taxes>

Now that we know that a single dollar earned during the financial year from driving would need to be declared as income on your tax return, an important tip to remember is to never spend your entire ride-sourcing income. Taking Uber as an example, if Uber driving is your second job, it is best to get into the habit of putting aside a portion of your total Uber earnings. This is mainly because as your taxable income increases due to your income as an Uber driver, your tax liability will also increase which is why you would need to save for that tax bill in order to avoid any large outgoings. As a general rule of thumb, if you have just begun driving, it is recommended that you keep at least 30-40% of your total Uber earnings to cover your tax expenses later on.

<How to Access Your Uber Tax Information>

For those of you who are with Uber, you can easily find your tax information as follows:

1. Log into partners.uber.com

2. Click on ‘Tax Summary'

3. Select the relevant statement (Your Annual Tax Summary should be made available to you around mid-July)

Tax can be confusing and tricky which is why we’re here to help you with your tax affairs. If you need further assistance, please do not hesitate to contact us through our official Facebook Page (P&C Tax Professionals – Australia) or send your enquiries directly to our email address at: pnctax@naver.com.

Thank you and bye for now!