Why Rideshare Drivers Have Special GST Rules in Australia
Unlike standard Australian sole traders who benefit from a GST threshold of $75,000 in gross turnover, passenger rideshare drivers (Uber, DiDi, Ola, Shebah) are legally classed as taxi travel providers under Australian tax law.
Under the A New Tax System (Goods and Services Tax) Act 1999, anyone providing taxi travel must register for Goods and Services Tax (GST) from dollar one of income, regardless of whether you drive full-time or just two hours on a weekend.
Driving Uber Eats or Food Delivery Only?
Food delivery riders (Uber Eats, DoorDash, Menulog) are not classified as taxi travel. Food delivery drivers only need to register for GST if their annual gross turnover exceeds $75,000. However, if you drive both UberX and Uber Eats, all of your earnings become subject to GST.
How to Calculate GST on Uber Fares (The Gross vs. Net Trap)
The most common tax mistake new rideshare drivers make is calculating GST on the final net bank deposit from Uber. The Australian Taxation Office (ATO) views you as the primary service provider charging the passenger the full trip fare.
The Official ATO Accounting Workflow:
- Gross Fare (Your Sales): You collect 100% of the passenger fare. The GST portion is calculated using the standard 1/11th rule formula (Gross Fare ÷ 11). This amount is reported in Label 1A on your Business Activity Statement (BAS).
- Platform Service Fees (Your Expense): Uber or DiDi charges you a service commission (typically 25% to 27.5%). Because this is a business operational cost, the service fee includes GST. You claim 1/11th of this service fee back as an input tax credit in Label 1B.
- Car & Running Expenses: You claim 1/11th of all eligible business expense receipts (fuel, servicing, insurance, car washes, mobile phone) multiplied by your logbook business-use percentage in Label 1B.
Worked Example: A Typical Weekend Driving Session
Let's break down the exact mathematics for a weekend where you complete $1,100.00 in passenger fares on UberX:
| Line Item | Gross Figure | Calculation | BAS Placement |
|---|---|---|---|
| Gross Passenger Fares | $1,100.00 | $1,100 ÷ 11 | Label 1A: $100.00 GST Owed |
| Uber Service Fee (27.5%) | $302.50 | $302.50 ÷ 11 | Label 1B: $27.50 GST Credit |
| Fuel Receipt ($110 at 80% Logbook) | $88.00 (Business) | ($110 ÷ 11) × 0.80 | Label 1B: $8.00 GST Credit |
| Net GST Payable to the ATO (1A minus 1B) | $64.50 Payable | ||
Claimable GST Deductions for Rideshare Drivers
To lower your net quarterly BAS bill, keep tax invoices for all vehicle-related expenses. Some items are 100% claimable, while others require a logbook percentage split or are completely exempt from GST:
- Fuel & Oil: Claimable based on your business logbook percentage.
- Vehicle Servicing, Repairs & Tyres: Claimable based on logbook percentage.
- Car Wash & Detailing: 100% claimable if performed specifically for rideshare driving.
- Passenger Amenities: Bottled water, mints, tissues, and sanitiser purchased for passengers are 100% claimable.
- Mobile Phone Data Bill: Claimable based on the estimated percentage used for the rideshare driver apps.
- Tolls: Citylink, Eastlink, or interstate tolls incurred while en route to pick up or transport passengers are claimable.
Filing Your Quarterly BAS
Registered rideshare drivers lodge a Business Activity Statement every three months. Standard ATO quarterly deadlines are:
- Q1 (July – Sept): Due 28 October
- Q2 (Oct – Dec): Due 28 February
- Q3 (Jan – March): Due 28 April
- Q4 (April – June): Due 28 July
You can lodge your BAS online via MyGov using ATO online services, or through automated software accounting integrations like Xero, QuickBooks, or Airtax. Have questions about specific tax forms or need assistance with custom calculations? Visit our Contact Page to reach our team.