Seven Steps To Sorting Your Uber Tax Obligations

Updated 7th of June 2024

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

1. Get an ABN
2. Register for GST (rideshare drivers only)
3. Keep records of your expenses (don’t worry about income, you’ll be able to download reports for that)
4. Keep a logbook, essential if you want to claim tax deductions for your car
5. Put aside some of your earnings to save for your GST and Income Tax bills
6. Lodge BAS’s quarterly to pay GST (rideshare drivers only)
7. 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. 

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 on your ABN 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 of your expenses. You can use whatever system works best for you, whether it’s an app, 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 establish the habit and also to make them easier to add up, so that 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 related 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 from your rideshare and delivery companies that show your income. The same goes for the fees you pay them. You’ll download reports each quarter showing your income for your BAS, and an annual report for your tax return at the end of the financial year.

If you’re registered for GST, 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.

Your 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 around $8 You can also use an app, but you must still manually record your odometer readings at the start and end of every trip, 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, which is capped at 5,000km. For the 2024 financial year the rate is 85c cents per km, so your maximum claim will be 5,000kms x 85 cents per km = $4,250. For the 2025 financial year the rate increases to 88cpkm x 5,000km = $4,400. 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.

For more information, visit our blog post on How To Keep A Logbook For Uber.

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 (if you’re registered for 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:

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 drive 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 the 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 deduction 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.

Bonus…..!

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

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 15 years, and has been specialising in tax for Australian Uber Drivers for the last 7 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.

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. 

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