Ride Sharing (Uber) - Institute of Certified Bookkeepers
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October 2019
Ride Sharing (Uber)
What is Ride Sharing?
Ride sharing services involve drivers using private vehicles to transport paying customers. Ride sharing
is an alternative to existing commercial taxis and chauffer services. Customers use a mobile phone app
to book drivers and get instant price estimates, based on GPS information (the apps can also provide
additional features such as driver ratings and vehicle information). Uber is the most popular rideshare
platform currently available in Australia, and will be used for all examples throughout this document.
Ride Sharing Platforms Available in Australia
Of the increasing number of rideshare services expanding throughout Australia, the main ones are:
Uber – the first major rideshare service available in Australia, setting precedent for the legal status
of ride sharing after prompting legislative changes at state and territory levels.
Ola – India’s most popular rideshare service entered the Australian market in 2018 and has a similar
pricing structure to Uber, but mostly operates only in capital cities.
DiDi – a Chinese app which operates in Asia, South America and parts of Australia (currently Melbourne,
Geelong, Newcastle and Brisbane as of July 2019).
GoCatch – an Australian company which can book taxis and private drivers throughout NSW, Victoria
and Queensland, as well as in Adelaide and Perth.
Shebah – an Australian all-women rideshare service launched in 2017, aiming to provide a safer
alternative for women and children, operating in most major cities.
There are also some smaller options targeting specific areas such as Scooti (motor scooter rideshare
localised to central Melbourne), HOP (partnered with Hertz to supply rental cars for rideshare drivers
in Sydney) and Muve (community-focused service operating in Brisbane and Melbourne).
GST Law
Current law states that all taxi drivers and chauffers – including ride-sharing – must be registered for GST
from the first dollar of income (division 144 of the GST Act). This is to avoid confusion about pricing,
and results in all customers paying the same rates.
Uber challenged the ATO over the application of GST on the basis that “ride-sourcing drivers do not
supply taxi travel”. The ATO view is that providing driving or ride-sharing services is the same as providing
taxi travel services, because a car is made available for public transport use and as such the current law
stands for Ride-Sharing drivers.
The ATO has previously admitted to “some uncertainty about how tax applies to various sharing
economy models” and won’t be pursuing any Uber drivers regarding records and GST registration prior
to August 2015. However, from August 2015 onwards, the ATO expects that all Uber drivers will be
registered for GST, providing invoices and declaring Uber-related income.
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 1October 2019
Driver Obligations
Drivers offering services via Uber are doing so with Uber acting as an agent by providing the booking
and payment gateway, therefore there are certain obligations the driver needs to meet.
Registration for an ABN and GST is the obligation of the individual driver.
Drivers must complete and lodge a quarterly BAS regardless of the amount of turnover.
Because registration is mandatory drivers may not elect to report annually.
Drivers must issue tax invoices, when requested within 28 days, if the transaction is over $82.50.
If the transaction is less than $82.50, the proof of payment receipt from the customer’s credit card
or the email receipt is sufficient for a customer to claim a GST credit.
Income derived from Uber is declarable on the individual tax return at the end of the financial year.
Paying GST Using ATO Payment Card
Drivers, taxi drivers, chauffers, limousine drivers and rideshare drivers have the option to use an ATO
activity statement payment card (this is only available to people in the taxi services industry).
The card can be used to make small frequent payments; however, the driver must record the payments
to work out the final balance due when the BAS is due. The BAS must still be lodged by the due date,
and any outstanding amount paid.
NSW Passenger Service Levy
From 1st February 2018, the NSW Government introduced a passenger service levy, which is a temporary
levy of $1 per trip for any authorised taxi service provider. A taxi service provider includes:
taxis
hire cars
rideshare (Uber)
other passenger services for a fare in vehicles with 12 seats or less (including driver)
The taxi service provider has the option to pass.
Payment of the Levy
Payment can only be done through the Industry Portal.
The taxi service provider is required to register.
Calculate the Levy
Passenger Service
Transactions per Year Levy Payable
1–150 $0
151–400 $150 total, payable annually
401–600 $400 total, payable annually
600+ $1 per passenger service transaction, calculated and paid monthly
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 2October 2019
Bookkeeping for Uber Driver
Set up the chart of accounts to reflect the types of income and expenses that are required to be reported.
Uber Fees
The Uber driver will receive an invoice for fees from Uber which has GST included. These fees are claimable
as an expense to the driver, and a copy of the invoice must be kept as part of the record keeping.
Example:
Uber has an app for drivers to use on their mobile phone which provides the following information:
Weekly earnings: Daily Earnings:
1. Report period 1. Total net earnings for the day
2. Graph of daily earnings for the week, then a 2. Breakdown of day’s earnings including Fares,
second tap gives total list of trips for the day. Boost, Tolls and Cancellation Fees.
3. Total net earnings for the week, including 3. Number of trips for the day
fares and other earnings from promotions. 4. Total earning per trip
4. Detailed transactions for the week chosen
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 3October 2019
GST Calculation on Fares
There are different types of income that can be earned driving for Uber:
Fares
GST must be calculated on the full fare, not the net amount received after commission etc.
have been deducted from the payment by Uber.
Example:
A passenger pays $55, the driver receives $44 after commission – the GST payable is $5.00.
The $11 is claimed as a GST-free expense or a tax deduction on their income tax.
Cancellation fees
This is charged when a customer doesn’t show for a booked trip, which still results in a driver
arriving at the pickup destination. The customer is charged. There is GST on cancellation fees.
Bonus or Top-Up Payment
If these payments are from an overseas facilitator it is GST Free, e.g.:
Bonus for marketing and promoting to potential clients;
Operating during certain times such as peak periods, and receiving a top-up payment
(only the top-up payment is GST-Free, not the normal fare).
Claiming the Business Cost for the Car
Many Uber drivers use their vehicle for both personal and Uber use. When claiming an expense against
the business, only the business usage can be claimed, therefore the driver must determine the percentage
claimable.
Example:
Driver uses their car 40% for Uber and 60% for private, therefore 40% of any car-related expenses may
be claimed.
Purchase a new car for $44,000 inc. $4,000 GST
40% = $17,600 ÷ 11 = $1,600 GST Claim
Fuel cost of $145.00 inc. GST
40% = $58.00 ÷ 11 = $5.27 GST Claim
The full value of the expenses may be entered with a journal at end of each quarter to remove the private
portion of the expenses to a drawings account.
Example:
Total Expenses Private Portion
Total Amount
for March 2018 Quarter Amount × 60% (.60)
Fuel $1,740.00 $1,044.00
Repairs and Maintenance $427.00 $256.20
Cleaning $325.00 $195.00
TOTAL $2,492.00 $1,495.20
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 4October 2019
Journal to Drawings:
Total Private portions
Credit Expense Debit Drawings
for March 2018 Quarter
Fuel $1,044.00 $1,044.00
Repairs and Maintenance $256.20 $256.20
Cleaning $195.00 $195.00
TOTAL $1,495.20 $1,495.20
The ATO also allows all costs to be claimed during the year, with an EOY adjustment made for the full year
on the June BAS, being that the repayment has been previously claimed through the year.
Bookkeeping for Uber Passenger
A business owner may use Uber when travelling for business. They access Uber through a phone app
set up with credit card details so that payment is automatically taken after the trip. The app allows them
to book the trip (gives an estimate of cost), and at the end of the trip they receive an email with the
following information:
Details of Trip – date, time, cost and driver information
Fare details – Base Fare, Distance, Time and Total cost of the trip
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 5October 2019
Clicking the link above for “Visit the Trip Page” allows them to download/request a tax invoice.
The tax invoice is then downloaded for the business owner’s records:
FBT Exemption for Employee Travel
Any benefit arising from taxi travel by an employee is exempt from fringe benefits tax, however this is
not applicable to Uber/rideshare expenses.
Benefits for employees for taxi travel is exempt from FBT if the travel is a single trip beginning or ending
at the employee’s place of work, and also if:
a result of sickness of, or injury to, the employee
the whole or a part of the journey directly between any of the following:
the employee’s place of work
the employee’s place of residence
any other place that it is necessary, or appropriate, for the employee to go as a result of the
sickness or injury.
Uber for Businesses
Uber also has a business option; the business profile makes it easier to get the relevant business receipts
and tax invoices in one place, and can also be used with a team of employees. Recommend suggesting
that your business owner sets this up to make it easier to differentiate between business and private.
Uber also provides a single report that details trips for the week or month which can assist in reconciling
travel across a team.
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 6October 2019
GST Claim on Business Expenses
When a business uses Uber for work-related travel, GST may be claimed.
If over $82.50 a Tax Invoice must be retained.
GST is claimable on all taxi, Uber, and other driver services from 1st August 2015.
References
ATO – Ride-sourcing
ATO – GST and taxis
ATO – FBT – Taxi travel expenses exemption
Waiver of Tax Invoice Requirement (Legislative Instrument)
GST Act 1999
Uber for Business – Business Profiles on Uber
NSW Passenger Service Levy
[BKP] Ride Sharing (Uber) © The Institute of Certified Bookkeepers Page 7You can also read
