The ATO has updated its guidance on the tax issues that need to be considered when clients are involved in ride-sourcing arrangements.
The ATO confirms that ride-sourcing providers need to be registered for GST regardless of their turnover. This means that they need to obtain an ABN, register for GST, be prepared to issue tax invoices and meet activity statement obligations.
Income from ride-sourcing also needs to be included in a tax return along with deductions for expenses incurred when transporting passengers for a fare.
WHAT YOU NEED TO DO
Similar tax obligations for taxi drivers apply to ride-sourcing providers. The following are the basics you need to know and do for tax purposes, including keeping records of all your expenses and income and apportioning expenses to the time you are providing a ride-sourcing service.
Income tax
o Include the income you earn in your tax return
o Only claim deductions related to transporting passengers for a fare
GST – if you have a ride-sourcing enterprise
o Get an Australian business number
o Register for GST regardless of how much you earn (ride-sourcing is taxi travel for GST purposes)
o Pay GST on the full fare
o Only claim GST credits related to transporting passengers for a fare
o Lodge business activity statements
o Know how to issue a tax invoice (you need to provide one for fares over $82.50 (if asked)