If you drive for Uber, here’s some Uber tax advice you should pay attention to.
INCOME REPORTING ON TAX RETURNS
The money you make from being an Uber driver is taxable income and should be listed on your tax return.
The costs you incur while working for Uber are tax-deductible. This could include costs that arise from maintaining, operating or holding any assets necessary to offer the travel services.
CLAIMING TAX DEDUCTIONS RELATED TO WORK
You can claim deductions for the things below:
-The service/licensing fees or commissions you pay to Uber
-The cost of qualifying as a driver for Uber (after you have begun the application procedure, like the police and medical checks, fees for application, etc)
-Passenger expenses like mints and water, or gas for the vehicle
-Parking
-Tolls
-Cell phone expenses
-Car registration or licensing
-Expenses related to fixing, servicing, and cleaning the car
-Safety tools (like high visibility vests)
-Accountant’s/tax agent fee
-Bank charges (if you have an account allocated to your work for Uber)
-Insurance
Expenses incurred prior to qualifying as a driver for Uber, or prior to the application procedure (like attending information evenings), aren’t tax-deductible.
TAX DEDUCTIONS RELATED TO WORK THAT DOES NOT QUALIFY FOR CLAIMS:
-Fines (speeding and parking, etc)
-Fees for having a standard driver’s license
-Drinks, food, etc bought during shifts
-Clothes that are not used for safety purposes
HOW TO CLAIM DEDUCTIONS FOR THE BUSINESS USE OF A VEHICLE
You can get a tax deduction if you drive your vehicle for business purposes in a couple of ways:
Cents per/km:
Claim sixty-six c per/km from July 1, 2016, or a value between sixty-five c and seventy-seven c per/km for previous years (based on the capacity of the engine).
This strategy only works for distances of 5000 km or less. It does not work if you drive over 5000 kms on business.
The following strategy includes all vehicle costs, like depreciation, servicing and gas, etc. No additional claims can be made.
Logbook:
-You have to base your claim on the proportion of business use for each vehicle cost, which is decided by a record book that has been stored for at least twelve weeks
-This record book has to be updated in five-year intervals
Every expense related to your vehicle operation can be claimed, depending on the proportion of your business use, in line with your record book.
CLAIM AN IMMEDIATE $20K CAPITAL ASSET WRITE OFF
The ATO regards Uber drivers as self-employed workers. Consequently, you can enjoy the tax breaks that small businesses enjoy, such as the $20k immediate capital asset write-off, which is offered until June 30, 2017. This means that you can instantly deduct the costs of any equipment, plants, or tools you use while working, including things like computers and cars — as long as the amount is under $20k (extremely useful for drivers who buy second-hand vehicles).
