Uber has taken Australia by storm as a great new way to earn additional income. If you have a reliable car, you have an opportunity to earn. Sounds great doesn’t it. But with anything that sounds great, you need to do your research and you need to be financially prepared so you don’t rack up a huge tax debt.
When you drive for Uber you are not an employee. You are a contractor and that means Uber does not withhold any tax and YOU are responsible for your own tax obligations.
The ATO’s Uber tax rules are:
- Any money you make driving for Uber counts as income, therefore you must declare it on your Tax return.
- Even if you earn less than the $75,000 GST income threshold, as an Uber driver you MUST register for GST.
All Uber drivers should register for GST then start to lodge a quarterly BAS statement and pay GST obligations.
On the bright side there are some great tax benefits of being an Uber driver. There are a number of tax deductions you can claim including registration, insurance, repairs, tyres, car cleaning and more. Not only that there are additional costs that are directly related to becoming and operating as an Uber driver that you will be able to claim such as refreshments for passengers, costs of registering as an Uber driver and work-related parking.
Just don’t declare it?
Now if you thinking you don’t need to register for GST and you can simply ‘not declare’, we strongly advise against this. As an Uber driver your name and plate are listed on the Uber app. The ATO can easily determine what your income is from being an Uber driver. If you don’t declare you are facing huge tax repayments, fines and interest charges.
It’s too hard?
A bit of planning and organisation will see you financially better off and on the good side of the ATO. Find yourself a good bookkeeper or tax agent who can help.
Get On Top Bookkeeping to the Uber rescue!
Get On Top Bookkeeping is now offering an Uber package.
This package includes setting you up correctly, we will record your income and expenses so you can see what your actual costs are and provide you with reporting so you can easily understand the financial position of your Uber business. This includes reconciling transactions, listing deductions, recording what GST has been received and paid, preparation of BAS and the electronic BAS lodgement.
Basically we will take the ATO headache away from you ensuring your business is financially kept up-to-date and on the good side of the ATO. So you can sit back and enjoy the Uber ride.