Here’s an important piece of advice for all the uber and rideshare drivers out there- you need to file a BAS to the ATO each quarter!
Yes, you’ve heard that right. In this guide, we’ll talk you through the entire process of how you could do so.
Uber has turned the entire taxi business upside down with its revolutionised services and customer experience. It won’t be wrong to say that uber has very smoothly made its way upwards as a well earning opportunity in Australia.
Uber takes its commission from what its riders earn. It almost takes 25-30% commission depending upon the city you work in. In 2021, uber contributed $10.4 billion in the Australian economy.
If you’ve just started working as an uber driver and you don’t know about the whole BAS thing, let’s make it easy for you. In this article, we will be covering all the important bits such as how you can calculate GST on your rideshare and Uber income, what expenses you can claim and how you can report your BAS to the ATO.
Are Uber drivers Required to be Registered for GST?
Here are the conditions on which you must register for GST:
- If you’re earning more than $75,000 from any other business and $0 from ridesharing.
- If you earn $1or more from ridesharing.
Basically all uber and rideshare drivers are required to register for GST, the $75000 threshold does not apply for the drivers.
These laws however are not applicable to uber food delivery riders. If you only drive for UberEats and don’t drive uber otherwise, then you’re not required to register for GST unless your total ABN income from all sources exceeds the $75,000 threshold.
So, if you do both, rideshare and food delivery, then the rideshare rules apply to your income and you are required to register for GST.
Once you are registered for GST, that will apply to any other income you earn on your ATN. So, even if you’re running small side businesses or earning small side incomes, that income will also be subjected to GST now.
ABN for Uber and Rideshare
ABN stands for Australian Business Number. Every businessman including uber and rideshare drivers in Australia must possess an ABN. If you don’t already have one, you can submit an application to the ATO.
We are able to get an ABN only once in our life and we are supposed to use that ABN for all our business activities. If you’re already using that ABN for an income, you have to use the same ABN for uber and rideshare income as well.
If you had an ABN in the past which is now inactive or cancelled, you still have to make it active since you can’t get a new one in any case. To look for your past or current ABN, go to the Australian Business Register section.
How is GST Calculated on your Uber Income?
Your uber income is inclusive of GST. Your GST from your fare is calculated as 1/11th of the income.
For example, if you earn $21 from one of your Uber rides, the GST on this will be $1.9.
This means that as an Uber or rideshare driver, 1/11th of the total fares or 1/11th of all other
expenses a rider pays to you must be paid to the ATO.
Claiming Work Related Taxes
When you are GST registered, you can claim GST credits for the GST included in the expenses in your business.
Expenses sustained as an Uber driver are tax deductible and you can claim them back.
Here’ are a few examples of the expenses you can claim as a Uber or rideshare driver in Australia:
- Parking expenses.
- Vehicle licensing.
- Licensing paid to Uber.
- All the ride costs such as fuel for the car.
- Insurance expenses.
- Maintenance of the vehicle.
- Expenses incurred in becoming an Uber driver.
- Phone bills.
Income Tax on Uber Income
The income you earn from Uber and rideshare is assessable income and must be reported to the ATO in your income tax return. So, in addition to GST, you are also obliged to pay income tax on your income.
But the good thing is that you can claim expenses on both, your GST and income tax. You can claim from your GST portion on your BAS each quarter, and the rest of the amount on your tax deduction at the end of the year on your income tax return.
BAS for Uber and Rideshare
Now that we’ve covered the GST portion, let’s look at the BAS for Uber drivers.
BAS – What is it?
BAS stands for Business Activity Statement. If you are registered for GST, you have to submit this form to the ATO.
BAS is a form that businesses and sole proprietors must lodge to the ATO to report all their taxes, sales, expenses and pay tax to the ATO.
BAS reports the ATO on how much tax you have to pay or get paid. Here are the three main things that this form asks for:
- Gross Sales – Total amount of sales you’ve made for the quarter before any tax deductions.
- GST on Sales- This means the 1/11th of your sales.
The amount you have to pay to the ATO through BAS is calculated using this formula:
- GST on sales – GST on expenses = Net GST payable
BAS can be lodged online through myGov or through some tax agent. The due date for lodgment depends upon the lodgment frequency.
Due Dates for Quarterly BAS
Almost all of the Uber drivers choose to lodge BAS quarterly which I suggest is the right option!
Lodging twelve BAS’s per year is way more difficult and expensive. If you are planning to get it done through a tax agent, it will triple the accountants fee. And even if you’re planning to lodge it on your own, it’s much more work and if you forget the due date, you’ll be hit by some serious penalties. Owing to these reasons, we suggest you lodge your BAS quarterly.
Here are the due dates for it:
- September Quarter
Lodge yourself through paper form – 28th October
Lodge yourself through myGov- 11th November
Lodge though a tax agent – 25th November
- December Quarter
Everyone has to pay on 28th February.
- March Quarter
Lodge yourself through paper form – 28th April
Lodge yourself through myGov- 11th May
Lodge though a tax agent – 25th May
- June Quarter
Lodge yourself through paper form – 28th July
Lodge yourself through myGov- 12th August
Lodge though a tax agent – 25th August
If the due date occurs on a weekend or a public holiday, you’re supposed to lodge it on the next business day.
Lodging a Nil BAS
If your income for a quarter is Nil, which means you did not earn anything for that quarter, you’re still supposed to lodge a BAS, a Nil BAS.This applies when you are registered for GST.
It’s very simple and easy to lodge a Nil BAS. Just go to your myGov account, next to the Business activity statement for that quarter, tick the box in front of the Nil BAS to lodge and then submit.
How to Lodge your BAS as an Uber driver in Australia?
When your due date arrives, you have two options to lodge- through a tax agent or by yourself through a paper form or myGov for free.
If you choose to lodge through a tax agent, you have no work to do but money to pay and the work will be done. An authorised tax agent will see for all the important reminders and dates, lodge and make amendments on your behalf. You got absolutely nothing to worry about!
But if you decide to save yourself from the accountants fee, here’s how you can lodge on your own.
You first have to calculate all the costs and expenses on your own. That could’ve been a lot of work if it wasn’t for uber tax calculators Australia. But these calculators have cut the major portion of your calculation work.
Here’s a small step by step guide:
- Create a myGov account if you don’t already have one. To create one, go to https://my.gov.au/ and follow the steps to make an account and link it to your tax details.
- Once the myGov setup is complete, log in. After linking it to the tax portal, select the business account and check whether you have a BAS to lodge.
- You should have all your calculations done and have the right figures on your hand.
- Put the exact three figure number only as whole dollars.
- After pressing Save and Continue, you will see a breakdown of what you’ve entered, followed by the amount you have to pay.
- Next, when you click on pay, you’ll see different payment methods. Select your desired one.
Note: You’re not obliged to pay your GST on the same date you lodge your BAS on.
Also an important point to keep in mind is that you need to file your BAS before the due date. If you forget to do so, ATO is most likely to penalise you. But the ATO does not penslie right away. It takes 2-3 times to charge you with penalties.
As an uber driver, you must register for GST no matter what your income is and declare that income on your tax return. This helps you to claim all your business expenses as a driver. We’ve mentioned above what expense you can claim for. Make sure that it’s a business expense not a personal one.
All the drivers should know what they should pay and what they should get paid. And this guide makes sure that they do!