Working for a food delivery app

If you deliver food or goods through an app such as DoorDash or Uber Eats, how you’re classified for tax purposes matters. Whether you’re considered an employee or an independent contractor affects how you report income, pay tax, and claim deductions. In this article, we answer common questions from food delivery drivers and couriers to help you understand your Australian tax obligations.

Do I need to apply for an ABN or register for GST?

Working out if you’re an employee or contractor will help you answer this question.  You can use our employee or contractor decision table this opens in a new window  to understand what applies to you.

• If you’re an employee, you won’t have to apply for an ABN or register for GST as part of your employment.

• If you’re a contractor and your GST turnover is less than $75,000, you’ll need to apply for an ABN this opens in a new window . 

• If you’re a contractor and your GST turnover is more than $75,000 (or you think you’ll earn above this amount) then you’ll need to apply for an ABN and register for GST this opens in a new window . 

If you’re not currently registered for GST, check each month to see if you’ve reached the threshold or are likely to exceed it.  Once you exceed the $75,000 threshold, you have 21 days to register for GST. 

How do I report GST?

If you’re a contractor registered for GST, you include GST in the price you charge for goods and services.  You also report any GST you collect in your BAS this opens in a new window .  Your BAS is completed monthly, quarterly or annually.  We’ll automatically send you a BAS to fill out when it’s time for you to lodge.

You’ll also be able to claim GST credits for business expenses via your BAS.

Remember to put aside amounts equal to the GST you’ve collected, so that you’re able to pay your BAS when payment is due.  If you think you might be unable to lodge or pay by the due date, contact us as soon as possible

How do I complete my tax return?

Where you report income on your tax return depends on whether you’re an employee or a contractor.

• If you’re an employee, report your income as salary and wages this opens in a new window .

• If you’re a contractor, complete the business section this opens in a new window  in your tax return to report your net income or loss.   

What deductions can I claim?

You can claim tax deductions relating to income you earn as an employee or contractor if:

• you’ve spent the money and not been reimbursed

• the costs relate to doing your job or running your business and aren’t a private expense (such as travel from home to your job)

• if the expense is for a mix of job or business and private use, you only claim the part that is used for your job or business

• you keep appropriate records this opens in a new window  to prove your claim.

You can find more information on our website about deductions you can claim as an employee this opens in a new window , and business tax deductions this opens in a new window .

I don’t want a big tax bill.  What can I do?

There are ways to ensure you don’t get a large tax bill when you lodge your tax return.  You can:

• make tax prepayments at any time and as often as you like

• sign up for pay as you go income tax instalments, otherwise known as PAYGI.  We’ll then use your income estimate to issue you with regular PAYGI activity statements.  We may also enrol you in the program based on information you provide us in your tax return.

We can also help if you get a bill when you lodge your tax return.  You can create a payment plan online using our online services in myGov, or you can contact us for tailored advice and support.

I’m on a working holiday maker visa. Do I need to lodge a tax return?

If you work as an employee, your employers will withhold 15% of your wages as income tax.  The requirement to lodge a tax return depends on how much you earn.  You don’t need to lodge a tax return or a non-lodgment advice if all the following apply:

• all your income as a working holiday maker was salary and wages

• the total of your taxable income for the income year was less than $37,001 (in 2019-20 and earlier income years) or $45,001 (from 2020-21 and later income years).

If you have an ABN and work as a contractor, you must lodge a tax return regardless of how much you earn.