# SALES TAX



## midwestuber

Sales tax is to be charged on all rides, it is a service, taxi's charge sales and pay it. Uber does not charge sales tax, does not collect it, does not pay it. When I asked Uber about it, I was told I am responsible to pay it out of my 80%. I then told them that was fine, then I would charge my customers the extra 6.5% we have here. I was told I am not allowed to charge any extra. I called my states department of taxation and explained the situation. I was told this was a taxable service and that whoever collected the money was responsible for collecting the sales tax and paying the sales tax. This would make a nice juicy story for your local reporter... and cost Uber millions. Just my 2 cents.
Lets take the fight back to them.


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## OldTownSean

Nice


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## OldTownSean

Something like this could make uber sorry the crapped on us. Now they have a bunch of people sitting around thinking b of ways to get even with them.


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## jo5eph

It is actually in the works....

Check out Usa today . I can't post links just yet.


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## Googyl

This is what I found: Service from intrastate transportation of persons is exempt in Ca. 

That was from a federal survey from 2007. Regardless if it's different for anyone, the person collecting the money is responsible. If we were responsible they can't charge 20% on the total fare. Which would mean they'd still have to calculate the tax to determine their cut.


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## Tommyo

State of CA will glom on this if they do not already have such authority.


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## mp775

California isn't the midwest, so I don't think he's in California. If transportation services are taxable, then the driver is ultimately responsible for paying them. In Rhode Island Uber collects and pays the sales tax for us, and we have an addendum to our agreement specifically dealing with sales tax.


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## Chewie73

I am a resident of New Jersey. I just started driving with Uber this week to fill a gap in employment. The promise of "Up To $20.00 per hour" is just "Flash-in-the-Pan". 
I've had multiple concerns with this from the start. One of which is the whole "Sales Tax" issue. I own a small home-based business that happens to include "Taxible Services" according to the State Tax Laws. As a "Business Owner", I am required to pay sales tax on my services. I am allowed under the laws to extend this tax to the customer or absorb it myself. That is my choice. I charge the sales tax on all of the services I provide in that business. 
Uber, however, says that Uber Partners are REQUIRED to pay ALL SALES AND USE TAXES ACCORDING TO STATE LAW. Since I CANNOT set rates and I CANNOT assess the applicable sales tax, I am NOT paying the tax out of my share. 

My last fare tonight was a 6.48 mile trip, using the map program attached to the Uber App. The Fare charged to the customer was $11.62. Out of which, Uber takes $1.00 for a "Safe Rider" fee, their 20% ($2.12), and leaves me $8.50. Now, out of that $8.50, $4.08 (approx.) will go to Uncle Sam in Self Employment Taxes, which leaves me $4.42. Take out the cost of mileage, which for 2015 the IRS allowed Business Mileage rate is $.575 per mile. That is $3.73. That means I made $.69 cents profit for that trip. If I am required to pay the 7% New Jersey Sales Tax on that $8.50 that I "Earned", that would be a tax of $.60, which means I made a whopping $.09 for my 12 minute 30 second ride. In the end, I'm making $.43 cents per hour. That is WAY below the New Jersey Minimum Wage of $8.38 per hour. 
Since we (Uber Partners) are considered Independent Contractors, and Uber sets the rates, collects the funds from the riders and distributes the funds to the "Independent Contractors", then Uber is required to pay all applicable sales tax. We don't control the money. We only drive the car. I've worked for companies that utilized "Independent Contractors". They provided the services. My company paid them their FEE. My company billed the customer. My company paid all applicable sales taxes. 

Don't be fooled by Uber User Agreements. The company that is HIRED for the service, bills for the service and collects payment for the service IS responsible for any and all applicable sales taxes. We are, however, responsible for our self-employment taxes and vehicle maintenance. Keep a detailed mileage log. This may be used with your tax return at the end of the year. Follow up with your individual tax expert regarding your personal income tax situations.


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## AintWorthIt

Interesting, I've never thought about tax. Between rate cuts, taxes, insurance and regulations, ride sharing is facing an uphill battle and it really is ubers own fault.


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## Long time Nyc cab driver

Chewie73 said:


> I made a whopping $.09 for my 12 minute 30 second ride.


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## DAmadNYsportsFan

midwestuber said:


> Sales tax is to be charged on all rides, it is a service, taxi's charge sales and pay it. Uber does not charge sales tax, does not collect it, does not pay it. When I asked Uber about it, I was told I am responsible to pay it out of my 80%. I then told them that was fine, then I would charge my customers the extra 6.5% we have here. I was told I am not allowed to charge any extra. I called my states department of taxation and explained the situation. I was told this was a taxable service and that whoever collected the money was responsible for collecting the sales tax and paying the sales tax. This would make a nice juicy story for your local reporter... and cost Uber millions. Just my 2 cents.
> Lets take the fight back to them.


sales tax in NJ is 7%.. not 6.5%


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## DAmadNYsportsFan

Chewie73 said:


> I am a resident of New Jersey. I just started driving with Uber this week to fill a gap in employment. The promise of "Up To $20.00 per hour" is just "Flash-in-the-Pan".
> I've had multiple concerns with this from the start. One of which is the whole "Sales Tax" issue. I own a small home-based business that happens to include "Taxible Services" according to the State Tax Laws. As a "Business Owner", I am required to pay sales tax on my services. I am allowed under the laws to extend this tax to the customer or absorb it myself. That is my choice. I charge the sales tax on all of the services I provide in that business.
> Uber, however, says that Uber Partners are REQUIRED to pay ALL SALES AND USE TAXES ACCORDING TO STATE LAW. Since I CANNOT set rates and I CANNOT assess the applicable sales tax, I am NOT paying the tax out of my share.
> 
> My last fare tonight was a 6.48 mile trip, using the map program attached to the Uber App. The Fare charged to the customer was $11.62. Out of which, Uber takes $1.00 for a "Safe Rider" fee, their 20% ($2.12), and leaves me $8.50. Now, out of that $8.50, $4.08 (approx.) will go to Uncle Sam in Self Employment Taxes, which leaves me $4.42. Take out the cost of mileage, which for 2015 the IRS allowed Business Mileage rate is $.575 per mile. That is $3.73. That means I made $.69 cents profit for that trip. If I am required to pay the 7% New Jersey Sales Tax on that $8.50 that I "Earned", that would be a tax of $.60, which means I made a whopping $.09 for my 12 minute 30 second ride. In the end, I'm making $.43 cents per hour. That is WAY below the New Jersey Minimum Wage of $8.38 per hour.
> Since we (Uber Partners) are considered Independent Contractors, and Uber sets the rates, collects the funds from the riders and distributes the funds to the "Independent Contractors", then Uber is required to pay all applicable sales tax. We don't control the money. We only drive the car. I've worked for companies that utilized "Independent Contractors". They provided the services. My company paid them their FEE. My company billed the customer. My company paid all applicable sales taxes.
> 
> Don't be fooled by Uber User Agreements. The company that is HIRED for the service, bills for the service and collects payment for the service IS responsible for any and all applicable sales taxes. We are, however, responsible for our self-employment taxes and vehicle maintenance. Keep a detailed mileage log. This may be used with your tax return at the end of the year. Follow up with your individual tax expert regarding your personal income tax situations.


self employment tax is not over 40% like you claim.. where did you get that info?


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## observer

Chewie73 said:


> I am a resident of New Jersey. I just started driving with Uber this week to fill a gap in employment. The promise of "Up To $20.00 per hour" is just "Flash-in-the-Pan".
> I've had multiple concerns with this from the start. One of which is the whole "Sales Tax" issue. I own a small home-based business that happens to include "Taxible Services" according to the State Tax Laws. As a "Business Owner", I am required to pay sales tax on my services. I am allowed under the laws to extend this tax to the customer or absorb it myself. That is my choice. I charge the sales tax on all of the services I provide in that business.
> Uber, however, says that Uber Partners are REQUIRED to pay ALL SALES AND USE TAXES ACCORDING TO STATE LAW. Since I CANNOT set rates and I CANNOT assess the applicable sales tax, I am NOT paying the tax out of my share.
> 
> My last fare tonight was a 6.48 mile trip, using the map program attached to the Uber App. The Fare charged to the customer was $11.62. Out of which, Uber takes $1.00 for a "Safe Rider" fee, their 20% ($2.12), and leaves me $8.50. Now, out of that $8.50, $4.08 (approx.) will go to Uncle Sam in Self Employment Taxes, which leaves me $4.42. Take out the cost of mileage, which for 2015 the IRS allowed Business Mileage rate is $.575 per mile. That is $3.73. That means I made $.69 cents profit for that trip. If I am required to pay the 7% New Jersey Sales Tax on that $8.50 that I "Earned", that would be a tax of $.60, which means I made a whopping $.09 for my 12 minute 30 second ride. In the end, I'm making $.43 cents per hour. That is WAY below the New Jersey Minimum Wage of $8.38 per hour.
> Since we (Uber Partners) are considered Independent Contractors, and Uber sets the rates, collects the funds from the riders and distributes the funds to the "Independent Contractors", then Uber is required to pay all applicable sales tax. We don't control the money. We only drive the car. I've worked for companies that utilized "Independent Contractors". They provided the services. My company paid them their FEE. My company billed the customer. My company paid all applicable sales taxes.
> 
> Don't be fooled by Uber User Agreements. The company that is HIRED for the service, bills for the service and collects payment for the service IS responsible for any and all applicable sales taxes. We are, however, responsible for our self-employment taxes and vehicle maintenance. Keep a detailed mileage log. This may be used with your tax return at the end of the year. Follow up with your individual tax expert regarding your personal income tax situations.


I wonder if there is anyway to check if Uber is paying sales tax in CA. That would be a major mistake if they haven't been paying it.


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## observer

DAmadNYsportsFan said:


> self employment tax is not over 40% like you claim.. where did you get that info?


Taxes as in plural. Just SS is 15%, you pay both halves when self employed. Plus federal income, state income,unemployment tax etc.....


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## Fuzzyelvis

I used to deliver newspapers free magazines at stores and did hot shot delivery for a while. The free magazines if course had no tax and the newspapers in houston 30 tears ago had a fight about collecting sales tax which they won. A 25 cent newspaper was NOT taxed. The hot shot delivery was all kinds of things. Documents, tile, anything legal really. The items may have been taxed (I picked up groceries once for someone--she paid for the items ahead of time including tax and paid the company I contracted with to pick them up.) In all cases I was a contractor and never paid taxes on the SERVICE to deliver. Most end delivery people were actually sub contracted by another contractor. I've done both. And NO ONE I knew ever did. Obviously this is one state and one municipality, but right now SALES tax is the least of my issues. I have been self employed before AND and employee using my own car and the IRS is the one to worry about. Keeping records of trips and mileage METICULOUSLY is something I bet 90% of drivers are not doing. Honestly with most of the rates I'm hearing you should have a mileage loss and owe nothing to the IRS for this gig this year. FYI I leave my app on except if I'm going somewhere where time is an issue and I could not accept any ping and use all that mileage. Even if I have a loss that's fine. It can still be a business not a hobby for a couple of years. And yes that technically means I'm "losing" money but if I'm driving home from my regular job and am willing to take a run but get none (very common as I'm in the suburbs) that's a free tax deduction. Anyway I digress but sales tax is not the biggest issue here at least although I am curious about it.


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## jo5eph

If it is really important to california, more than likely they will choose to go after uber rather than each and every driver out there.

Who keeps boasting about how much money they are making??


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## Chewie73

DAmadNYsportsFan said:


> self employment tax is not over 40% like you claim.. where did you get that info?


Self-Employment Tax, State Tax and Federal Tax Combined is approximately 45%. I get my tax information from my wife, who happens to be an IRS Enrolled Agent. Taxes is what she does for a living. Thanks for the inquiry....


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## Don't-Tell-Uber-I'm-Here

Chewie73 said:


> Self-Employment Tax, State Tax and Federal Tax Combined is approximately 45%. I get my tax information from my wife, who happens to be an IRS Enrolled Agent. Taxes is what she does for a living. Thanks for the inquiry....


I'm a new driver.
So much conflicting information out there.
Please ask her:

Is Self-Employment tax charged on income after expenses?

(If so, should be small if mileage etc is large - mostly because of tons of dead head miles, app on while driving home, etc).

THANK YOU for any info


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## Lee239

It's Uber's responsibility for sales tax they charge the fee, they can easily add each state's sales tax to each pax, if they don't it's on them.

I'm Uber's slave I don't make an income at tax time, I'm doing charity work for Uber and the pax are subsidized.


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## Leo1983

midwestuber said:


> Sales tax is to be charged on all rides, it is a service, taxi's charge sales and pay it. Uber does not charge sales tax, does not collect it, does not pay it. When I asked Uber about it, I was told I am responsible to pay it out of my 80%. I then told them that was fine, then I would charge my customers the extra 6.5% we have here. I was told I am not allowed to charge any extra. I called my states department of taxation and explained the situation. I was told this was a taxable service and that whoever collected the money was responsible for collecting the sales tax and paying the sales tax. This would make a nice juicy story for your local reporter... and cost Uber millions. Just my 2 cents.
> Lets take the fight back to them.


No one cares, I contacted my local government agencies. They don't care. I contact news outlets they don't care (there too busy sucking on trump shit). So absolutely no one cares that drivers make $6-7 an hr for a $25-30 an hr job. 
People seem to forget that the single most dangerous thing a human can do is drive. And we do it all day for change?

This is the new America where everyone gets shafted for the good of a few. 
Ps: this is going to blow up like Bernie madoff. Uber is a ponzie scheme beyond measure.


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## aarondavid1010

Leo1983 said:


> No one cares, I contacted my local government agencies. They don't care. I contact news outlets they don't care (there too busy sucking on trump shit). So absolutely no one cares that drivers make $6-7 an hr for a $25-30 an hr job.
> People seem to forget that the single most dangerous thing a human can do is drive. And we do it all day for change?
> 
> This is the new America where everyone gets shafted for the good of a few.
> Ps: this is going to blow up like Bernie madoff. Uber is a ponzie scheme beyond measure.


how are you only getting 6 dollars an hour?


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## Atom guy

Chewie73 said:


> I am a resident of New Jersey. I just started driving with Uber this week to fill a gap in employment. The promise of "Up To $20.00 per hour" is just "Flash-in-the-Pan".
> I've had multiple concerns with this from the start. One of which is the whole "Sales Tax" issue. I own a small home-based business that happens to include "Taxible Services" according to the State Tax Laws. As a "Business Owner", I am required to pay sales tax on my services. I am allowed under the laws to extend this tax to the customer or absorb it myself. That is my choice. I charge the sales tax on all of the services I provide in that business.
> Uber, however, says that Uber Partners are REQUIRED to pay ALL SALES AND USE TAXES ACCORDING TO STATE LAW. Since I CANNOT set rates and I CANNOT assess the applicable sales tax, I am NOT paying the tax out of my share.
> 
> My last fare tonight was a 6.48 mile trip, using the map program attached to the Uber App. The Fare charged to the customer was $11.62. Out of which, Uber takes $1.00 for a "Safe Rider" fee, their 20% ($2.12), and leaves me $8.50. Now, out of that $8.50, $4.08 (approx.) will go to Uncle Sam in Self Employment Taxes, which leaves me $4.42. Take out the cost of mileage, which for 2015 the IRS allowed Business Mileage rate is $.575 per mile. That is $3.73. That means I made $.69 cents profit for that trip. If I am required to pay the 7% New Jersey Sales Tax on that $8.50 that I "Earned", that would be a tax of $.60, which means I made a whopping $.09 for my 12 minute 30 second ride. In the end, I'm making $.43 cents per hour. That is WAY below the New Jersey Minimum Wage of $8.38 per hour.
> Since we (Uber Partners) are considered Independent Contractors, and Uber sets the rates, collects the funds from the riders and distributes the funds to the "Independent Contractors", then Uber is required to pay all applicable sales tax. We don't control the money. We only drive the car. I've worked for companies that utilized "Independent Contractors". They provided the services. My company paid them their FEE. My company billed the customer. My company paid all applicable sales taxes.
> 
> Don't be fooled by Uber User Agreements. The company that is HIRED for the service, bills for the service and collects payment for the service IS responsible for any and all applicable sales taxes. We are, however, responsible for our self-employment taxes and vehicle maintenance. Keep a detailed mileage log. This may be used with your tax return at the end of the year. Follow up with your individual tax expert regarding your personal income tax situations.


The Mileage deduction should negate any incomes taxes you might owe, so don't double count in your example.


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## aarondavid1010

Atom guy said:


> The Mileage deduction should negate any incomes taxes you might owe, so don't double count in your example.


we get the sales tax in canada


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