Rideshare and delivery drivers: tax, GST and deductions
Driving for Uber, DiDi, Ola or another rideshare platform, or delivering for Uber Eats, Menulog or DoorDash, is running a business in the ATO’s eyes. The income is taxable, there are deductions you can claim, and rideshare drivers have GST obligations from the very first trip.
You’re running a business
Rideshare and delivery drivers are generally treated as independent contractors, so:
- you need an ABN,
- the income is business income in your tax return, even if you also have a job,
- no tax is withheld, so you need to set money aside for tax, and you may be put into PAYG instalments.
The ATO receives data from rideshare and delivery platforms and matches it against tax returns.
GST: the big difference
Rideshare (passenger transport): this counts as taxi travel for GST purposes. You must register for GST before your first trip, regardless of how much you earn. You then:
- charge GST on fares (the platform usually handles this in how fares are calculated),
- lodge a BAS, usually quarterly,
- claim GST credits on your business costs, like fuel, servicing and the business share of your car.
Food and parcel delivery only: you only need to register for GST once your total business turnover reaches $75,000 a year.
Both: if you drive rideshare, you’re registered for GST for your whole enterprise, so GST also applies to delivery income.
Deductions you can claim
Car expenses
Usually the biggest deduction. You can claim the business share of:
- fuel, servicing, repairs and tyres,
- registration and insurance,
- interest on a car loan, or lease payments,
- depreciation on the car (subject to the car limit).
Work out the business share with a logbook kept for at least 12 continuous weeks, recording every trip including the kilometres driven between jobs and waiting for bookings. Alternatively, the cents per kilometre method covers up to 5,000 business kilometres a year, with no logbook needed, but full-time drivers almost always do better with a logbook.
Other costs
- Platform service fees and commissions
- Phone and data (business share)
- Car cleaning, and water, mints or charging cables for passengers
- Tolls and parking while working (not fines)
- Dashcam and phone mount
- Accounting fees
What you can’t claim
- The private share of your car and phone
- Fines, including parking and speeding
- Meals while you’re working, except in limited circumstances
- Clothing, unless it’s protective or a compulsory uniform
Keep good records
- Weekly platform statements and the annual tax summary
- Your logbook and odometer readings
- Receipts for all expenses
- Your BAS calculations
Most platforms provide a downloadable tax summary, but it doesn’t include your expenses or car costs.
Common mistakes
- Not registering for GST from the first rideshare trip, leading to back-dated GST, penalties and interest
- Claiming 100% of car costs without a logbook
- Forgetting to declare platform income because no tax was withheld
- Not putting money aside, then facing a tax bill and PAYG instalments in the same year
Getting help
We prepare rideshare drivers’ BAS and tax returns, set up a simple system for tracking kilometres and costs, and make sure the GST is right. As a sole trader, our package is $80 + GST a month. See business tax and accounting and how to keep accurate business records.