# Tax



## Distance (Jan 20, 2019)

Hi, I've heard and read a fair bit about the uber tax but there isn't any black on white link where it states exact figures, from my understanding so far if earning over 32k a year (basically every full time uber driver) has to save 32.5% for tax and 10% GST (before any deductions) plus I'd put at least 7.5% just for fuel, that would mean if you were to deduct nothing from the moment you start, before any car repayments/servicing etc. your daily earnings is double your NET income that you get to keep as profit, I'm not sure how much deducting fuel would affect that percentage but I am guessing it wouldn't even be near the 10% mark, having said that, how could one ACCURATELY to a 99.9% accuracy calculate how much net income they made with each weekly payment and from there make a payment online for tax and quarterly for BAS/GST so that the money left in the account would all be profit and not having to write down how much to save or put away and hold onto a pile of money that can't be touched until tax time? Sorry if it has been asked before on these forums but I can't find any sticky thread or anything specific which answers this exact question and I am hoping someone can help me out, thanks guys


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## Who is John Galt? (Sep 28, 2016)

Distance said:


> Hi, I've heard and read a fair bit about the uber tax but there isn't any black on white link where it states exact figures, from my understanding so far if earning over 32k a year (basically every full time uber driver) has to save 32.5% for tax and 10% GST (before any deductions) plus I'd put at least 7.5% just for fuel, that would mean if you were to deduct nothing from the moment you start, before any car repayments/servicing etc. your daily earnings is double your NET income that you get to keep as profit, I'm not sure how much deducting fuel would affect that percentage but I am guessing it wouldn't even be near the 10% mark, having said that, how could one ACCURATELY to a 99.9% accuracy calculate how much net income they made with each weekly payment and from there make a payment online for tax and quarterly for BAS/GST so that the money left in the account would all be profit and not having to write down how much to save or put away and hold onto a pile of money that can't be touched until tax time? Sorry if it has been asked before on these forums but I can't find any sticky thread or anything specific which answers this exact question and I am hoping someone can help me out, thanks guys


 You certainly went the Distance with that paragraph.

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## Distance (Jan 20, 2019)

hahah, just need to get the facts down right so I don't spend my tax money, also if business tax and personal tax are done separate, another job wouldn't count as combined income come tax time right?
I am doing full time uber at the moment but who knows.


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## Who is John Galt? (Sep 28, 2016)

Distance said:


> .....so far if earning over 32k a year (basically every full time uber driver) has to save 32.5% for tax and 10% GST (before any deductions) ....


I am not a tax expert and I'm not sure if I understand your post correctly, but we have a tax free threshold of $18,200 before we pay tax. In other words, the first $18,200 that you earn in a given financial year is effectively tax free. So you can earn up to $20,542 before any income tax is payable, when taking into account the Low Income Tax Offset.

Thereafter, we are subject to tax thresholds as per the screenshot below:










Do yourself a favour and consult an accountant in the first instance so that you know you are on the right track.

* The screenshot info above is taken from :
https://www.superguide.com.au/smsfs..._Income_tax_rates_for_20182019_financial_year


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## Distance (Jan 20, 2019)

Thanks, but isn't this for regular income rather than business as a sole trader? This is what is causing the confusion for me as you need an ABN, a TFN and you pay GST therefore isn't your income taxed as a business would be taxed rather than regular tax for people who don't run a business? I had a friend at my old job who had a music business and he had to file both his taxes separately, one for the job we worked and one for his business, my whole thing is if we basically have to pay 42.5% tax doing this full time including GST before any deductions then how can you make it worth the time if after servicing, fuel, car repayments and all other expenses you lose more than half your income and can only claim a percentage of that back on tax and have to wait until the end of the year to 'get it back'? I am sure no one here is raking in 500 every day to make sense of doing 12 hour shifts and getting a decent chunk of it to keep in the bank?


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## Who is John Galt? (Sep 28, 2016)

Distance said:


> Thanks, but isn't this for regular income rather than business as a sole trader? This is what is causing the confusion for me as you need an ABN, a TFN and you pay GST therefore isn't your income taxed as a business would be taxed rather than regular tax for people who don't run a business? I had a friend at my old job who had a music business and he had to file both his taxes separately, one for the job we worked and one for his business, my whole thing is if we basically have to pay 42.5% tax doing this full time including GST before any deductions then how can you make it worth the time if after servicing, fuel, car repayments and all other expenses you lose more than half your income and can only claim a percentage of that back on tax and have to wait until the end of the year to 'get it back'? I am sure no one here is raking in 500 every day to make sense of doing 12 hour shifts and getting a decent chunk of it to keep in the bank?


To be honest ....and to be fair, I have spent a long time working with the financial aspects of taxation, but they cannot be outlined, taught and absorbed in a paragraph or a 5 minutes lesson. I suggest the following:

Try and find an accountant to work with you. 
Be prepared to learn from them.

Be prepared to pay for his or her time, experience and skillset.

Don't try and shortchange him/her and pay well for good advice. 
If your cost is only $100 or $150 a quarter you are laughing. You will save a lot more than that in knowing that you are being professionally looked after.

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## Distance (Jan 20, 2019)

my whole thing is trying to get an actual idea of the tax figures as I've done my tax lodging for work income before and have a friend studying business finance at the moment and because the information is not available there its not an easy feat for someone with no experience with uber even if they are an accountant from what he's told me, depending where you go its what they'll deduct and what they want but if the figure is in fact 42.5% together with GST before deductions then realisticaly there would be no money in uber unless its a part time gig and you're under the 30+k bracket because even if you make $200-300 on an average day doing 12 hours, cut that in half for just tax and fuel maybe even another 10% for lunch on road, water, servicing, car repayments and that's without any parts being replaced thats $120 profit for 12 hours work, thats $10 an hour net income, I don't believe that people actually work 7 days a week 12 hour days for $840 net to keep maybe $1000 after deductions..? Even if I can't get exact figures in this thread I am sure I am way off on my calculations and that there is different figures than what I can gather because it seems almost impossible to be real.


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## Who is John Galt? (Sep 28, 2016)

Distance said:


> ......then realisticaly there would be no money in uber....


Correct.

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## Distance (Jan 20, 2019)

Okay so I've gathered some info, you first deduct your GST and you don't pay tax on GST then save/deduct the 30/32.5% tax, for everyone doing it full time then your deductions come into account, having started now until the EOFY i might be able to be under the $20000 tax bracket if not still squeeze into the 0.19c per dollar if the business tax is done same as the personal tax, from there if the business tax is done separately from personal that gives another $20k to be made before next annual inspection and find another job, unless there is some trick to magically not pay tax on uber I can't understand why someone would do it full time as the only source of income working 12h/7 days a week for $10/h after all expenses/tax.


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## Vespa (Nov 29, 2018)

Some just do it to keep them selfs from turning into a raging alcoholics

Nothing to do with profits but for a work life balance hard to find elsewhere.


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## Hugh G (Sep 22, 2016)

Distance said:


> I can't understand why someone would do it full time as the only source of income working 12h/7 days a week for $10/h after all expenses/tax.


A huge number of Uber drivers are not eligible for the dole, pension etc. This could be because of their immigration status, or personal financial situation. Others who may be on some government income may only be able to earn $150 or so due to Centrelink restrictions and as there are limited job prospects Uber is one of a very few viable options.


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## Vespa (Nov 29, 2018)

Hugh G said:


> A huge number of Uber drivers are not eligible for the dole, pension etc. This could be because of their immigration status, or personal financial situation. Others who may be on some government income may only be able to earn $150 or so due to Centrelink restrictions and as there are limited job prospects Uber is one of a very few viable options.


Is the 150$ earning gross or net income?

Is it before uber takes its cut or after?


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## Hugh G (Sep 22, 2016)

Vespa said:


> Is the 150$ earning gross or net income?
> 
> Is it before uber takes its cut or after?


It was just an example - you need to contact Centrelink and/or an accountant.

A friend of mine is a carer for his wife, he does a few night shifts as a nurse but can only earn a certain amount. Uber no good for him.

A relative is on a Miltary Full Disability pension, known as a GOLD CARD. He is limited by the amount of HOURS, not Dollars, that he can earn before it is taxable and/or causes a pension cut.

I think if you are on the Old Age Pension it's around $150 a fortnight - that's nett, but don't quote me


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## 258963 (Mar 28, 2019)

Distance said:


> Hi, I've heard and read a fair bit about the uber tax but there isn't any black on white link where it states exact figures, from my understanding so far if earning over 32k a year (basically every full time uber driver) has to save 32.5% for tax and 10% GST (before any deductions) plus I'd put at least 7.5% just for fuel, that would mean if you were to deduct nothing from the moment you start, before any car repayments/servicing etc. your daily earnings is double your NET income that you get to keep as profit, I'm not sure how much deducting fuel would affect that percentage but I am guessing it wouldn't even be near the 10% mark, having said that, how could one ACCURATELY to a 99.9% accuracy calculate how much net income they made with each weekly payment and from there make a payment online for tax and quarterly for BAS/GST so that the money left in the account would all be profit and not having to write down how much to save or put away and hold onto a pile of money that can't be touched until tax time? Sorry if it has been asked before on these forums but I can't find any sticky thread or anything specific which answers this exact question and I am hoping someone can help me out, thanks guys :smiles:


1 u r on abn, so forget 30% business tax....
2 calculation is simply, (payment from uber - bunch of things you can imagine whichever are deductible)/11=gst you own ato
3(payment from uber - bunch of things you can imagine whichever are deductible)/11*10=income before tax
4 no one 100% accurate in tax, if the calculation error is minor, ato wont bother chasing you because its not worthwhile.
5 base on my experience, if driving 'full time' with 'brand new' car then its lose from the 1st place
6 if u like flexibility, uber is good

gl


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## Jack Malarkey (Jan 11, 2016)

@Distance, you definitely need to go the distance and actually see an accountant to understand what you are doing.

In the meantime, have a look at these Australian Taxation Office guidelines: https://www.ato.gov.au/general/ride-sourcing-and-tax/.

If you are individual (sole trader) carrying on the business, your net business income is most certainly not taxed separately but is added to all your other assessable income and taxed essentially at your marginal tax rate.

The small business income tax offset does lower to some extent the tax otherwise payable on your net business income. For more information about this offset, see my post in this thread: https://uberpeople.net/threads/tax-benefits.317611/.

If your friend paid tax separately on his business income, he must have been carrying on the business via a company rather than as a sole trader.

In my own case, I set aside 30% of the amounts paid into my bank account to provide for GST and income tax on my rideshare income. After making my final income tax payment for the income year, I transfer any relevant remaining amount out of the special account.

I also have a 'car replacement fund' into which I pay each week 5 cents per kilometre (business and private). I have a very low cost and reliable car so 5 cents a kilometre is sufficient for my purposes. Up to 15 cents a kilometre may be appropriate for many drivers.

The information I have provided is not tax or financial advice but only some background to help inform the imminent discussion with your accountant.


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## snert (Sep 1, 2016)

Distance said:


> Hi, I've heard and read a fair bit about the uber tax but there isn't any black on white link where it states exact figures


Excuse me if this is a dumb question, but what is this Uber tax?
Is this more discrimination against Uber drivers?
Or is it a question about tax in general, I'm so confused. ?


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## BuckleUp (Jan 18, 2018)

Who is John Galt? said:


> To be honest ....and to be fair, I have spent a long time working with the financial aspects of taxation, but they cannot be outlined, taught and absorbed in a paragraph or a 5 minutes lesson. I suggest the following:
> 
> Try and find an accountant to work with you.
> Be prepared to learn from them.
> ...


I think you should be the absolute last person to be giving out tax advice.
Learn about assets and liabilities first, that's accounting 101.
Then you can ease into more complicated matters like thresholds and offsets.


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## Who is John Galt? (Sep 28, 2016)

BuckleUp said:


> I think you should be the absolute last person to be giving out tax advice.
> Learn about assets and liabilities first, that's accounting 101.
> Then you can ease into more complicated matters like thresholds and offsets.


You poor petal, will you be OK? Still smarting from the new girl immediately recognising you, are you?

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## BuckleUp (Jan 18, 2018)

Who is John Galt? said:


> You poor petal, will you be OK? Still smarting from the new girl immediately recognising you, are you?
> 
> .


Name calling?
How old are you again?
Like I said, you and her seem to have a lot in common.
I predict a bright future liking each others' posts.


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## Who is John Galt? (Sep 28, 2016)

BuckleUp said:


> Name calling?
> How old are you again?
> Like I said, you and her seem to have a lot in common.
> I predict a bright future liking each others' posts.


Yes, you are obviously still smarting. Poor thing, it must be hard when a new member within the space of one day recognises you for what you are.

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## BuckleUp (Jan 18, 2018)

Who is John Galt? said:


> Yes, you are obviously still smarting. Poor thing, it must be hard when a new member within the space of one day recognises you for what you are.
> 
> .


Yes, no one likes being called out on their bad financial decisions. Immature people always respond with name calling when they have no other argument to respond with. She thinks a $40k brand new car makes sense for uber x. You seem to agree. I leave you 2 at that...


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## Who is John Galt? (Sep 28, 2016)

BuckleUp said:


> Yes, no one likes being called out on their bad financial decisions. Immature people always respond with name calling when they have no other argument to respond with. She thinks a $40k brand new car makes sense for uber x. You seem to agree. I leave you 2 at that...


No matter what she thinks about Über, I would suggest her thoughts about you are right on the money.

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