ATO Obligations of an Uber Driver

Another regulatory/legal obligation that many Uber drivers fail to adhere to is the tax and GST obligations to the Australia Taxation Office ("ATO"). This is another area that the Uber company does not offer much assistance with.

Under the ATO, it does not matter whether you are a taxi driver or an Uber driver. As long as you are involved in the ride-sourcing business and use your car to transport passengers for a payment, you are considered to be providing taxi travel under GST law and will need to apply for an ABN, register for GST and charged GST on each ride-sourcing trip provided. You will also need to declare your income on your income tax return.

You are also required to lodged Business Activity Statements on a quarterly basis and not an annual basis if you are in the ride-sourcing business.

Although Uber is currently challenging this regulatory requirement, until the law is changed, it is still are requirement and remember, ignorance is no defence.

And unfortunately, the ATO does not charge its GST on the amount that you receive, but instead on the amount that Uber charges the passenger before Uber takes their fees out. So say for example if Uber charges $50.00 to the passenger and takes a fee of $12.50. You are only getting paid $37.50 from the ride and from that amount, you will need to pay thee 10% GST of $5. Your net earnings then will really only be $32.50.

And from that net earning, you still need to deduct expenses and income tax.

Makes you really wonder whether it is all that worthwhile driving Uber.

But in my mind set, having money in the pocket and being in the position to pay taxes is always better than not having the money and being drowned in debts.

For more detailed information regarding your tax obligations, please discuss the matter with your tax agent or accountant. More information can also be found from the ATO website: https://www.ato.gov.au/


If you're interested in signing up as an Uber driver, here's the link:
Sign Up as an Uber Driver