GST for Ride-Share service provider

[#1]

Hi. My friend is currently doing ride-share service as a part-time job. Recently, the ride-share company launched a campaign. This campaign encourages drivers to attract new customers and for each new customer registered (and subsequently used the service), he would get a small amount of money/bonus as referral fees. My question is does my friend need to pay GST for this amount? And if yes, can he claim any GST deductions for expenses occurred, such as printing promotional materials, related parking fees and gas? 

Thank you for your help.

[#2 · Accepted solution]

If the bonus payment is for a supply by the driver (e.g. for referring new drivers) to an Australian based platform, then the amount received will be a consideration for that supply and GST will be payable.

Any expenses can be claimed; printing, parking fees (not fines) and what do you mean by gas?

[#3]

Hi! Thank you for your reply.

So payment related to referring new customers is also GST payable even though there is no GST charged from customers? (I thought the reason why drivers need to pay GST is that they have collected GST from customers on behalf of the ATO so that they need to pay this amount, but in the above case, no GST has been charged from customers)

By saying gas I mean the gasoline used when driving around to send promotional materials such as the referring code.

[#4]

Petroleum Gasolene is otherwise known as Petrol in Australia/UK.

In the US they refer to it as Gas.

Gas over here is what we heat things up with.

The extra KIlometers that is travelled would be added to the business Kilometers in your logbook.

[#5]

Good to know. Thank you for your reply.

[#6]

Hi @Loe1995,

Thanks for getting in touch!

We're checking information about your query with a specialist area and we'll get back to you as soon as possible.

Thanks, JodieH.

[#7]

Hi @Leo1995,

Thanks for your patience whilst we checked information with a specialist area.

@macfanboy is correct. Referral fees represent a payment by the ride-sourcing platform for a supply of marketing by the driver. Therefore, assuming the platform is registered for GST, the driver will have a GST liability for the amount of the fee received.

A driver is entitled to claim GST credits for any GST included in the price of expenses incurred that directly relate to their ride-sourcing enterprise.

Thanks, JodieH.

[#8]

Thank you for the update.