Tax Return:: Tax Return for Food Delivery Businesses (e.g. Uber Eats, Menulog, etc.)

Hello, this is your tax and super specialist, P&C Tax Professionals.

As more people are seeking food delivery services in Australia, the demand for food delivery drivers is higher than ever. Since food delivery drivers generate income for delivering the food to your doorstep, there are certain tax implications that food delivery drivers must adhere to.

<Let’s start with the basics>

Similar to ride-sourcing drivers, the money food delivery drivers earn in exchange for their service is counted as assessable income. This means you must declare any income or expenses from your food delivery activities.

One of the biggest differences between a ride-sourcing driver (e.g., Uber, Didi, Ola, etc.) and a food delivery driver (e.g., Uber Eats, Menulog, Doordash, etc.) is that it is not compulsory for food delivery drivers to register for GST if they earn under the $75,000 income threshold. However, if you earn beyond $75,000 per year, even if you are a food delivery driver, you MUST register for GST and lodge your quarterly Business Activity Statements (BAS) by the due date.

An important point to note is whether you have made a profit or a loss from your business activities as a food delivery driver, you must still report every single dollar of your income and expenses in your annual tax return.

<Are you both a ride-sourcing driver AND a food delivery driver?>

Things will get a little more complicated if you happen to work as both a ride-sourcing driver and a food delivery driver. If this is the case, you must register for GST regardless of how much you earn through these activities and the standard GST rules will be applicable to BOTH of your activities.

<Lodging your tax return as a food delivery driver>

As mentioned earlier, no matter how little you have earned as a food delivery driver, you are obligated to declare all of your income and expenses. In order to do, you must first have an Australian Business Number (ABN) since you will be paid as a contractor and not an employee of the company. This basically implies that it is up to you to take good records of your income and expenses as they are incurred during the financial year.

Similar to ride-sharing drivers, it is recommended that you put aside a portion of your income (e.g., 30% of your earnings) from your food delivery activity in order to cover your tax bill when you lodge your tax return.

<Some common deductions for food delivery drivers>

Below are some of the tax deductions you may be able to claim on your tax return as a food delivery driver:

> Mobile phone bills (work-related %)

> Car expenses (cents/km or logbook method) – includes car registration, car insurance, fuel costs, parking, tolls, car repair/maintenance fees, etc.

> Safety equipment

> Commissions, licensing, or service fees that you have paid to the food delivery platform such as Uber Eats

> Prior year accountant fee (the accountant fee you have paid for this year would be deductible in your next year’s tax return)

You must ensure that you only claim the work-related % of your expenses and make sure that you keep good records of your purchases and payments as evidence to back up your claims.

Expenses that are non-deductible include:

> Normal driver's licence fees

> Speeding and/or parking fines

> Conventional clothing (even if you only wear it to work)

> Meals and drinks that are purchased during your shift

Let’s leave it here but if you have any other questions related to your tax or super, please send us your enquiry through our official Facebook Page (P&C Tax Professionals – Australia) or simply reach out to us on our email address at pnctax@naver.com.

Thank you and bye for now!