In response to COVID-19, the Government has announced a variety of Coronavirus Stimulus packages and we’re here to discuss how they apply to rideshare and food delivery drivers.
Whether you driver for Uber, Didi, Ola, Shebah or UberEats, drivers have a few payment options to choose from, such as the Jobkeeper and the Jobseeker payment options. However, you can only claim one or the other.
Option 1: Jobkeeper
The legislation has passed in Government. We’re continuously seeking further clarity in relation to how this applies to the rideshare industry. As this information becomes available, we will update this post. If you’re unsure of anything, book a free appointment with us.
What is it?
Sole traders which cover Uber and all Rideshare drivers who have been impacted by the Coronavirus will be able to access the Jobkeeper subsidy from the ATO.
How much you can get?
Rideshare drivers, could be eligible for $1,500 per fortnight regardless of if you were a full-time or part-time driver. You will be required to report your income to the ATO every month.
The first payment will be made on the 1st May 2020, backdated for applicants to 30th March 2020 for a maximum period of 6 months.
Who is eligible?
As an Uber, Rideshare driver you will be eligible for the JobKeeper Payment if, at the time of applying, you:
- Estimate your gross income (before expenses, including fees) has or will fall by 30 per cent or more;
- You had an ABN on or before 12th March 2020 and meet one of the following:
- You’ve lodged your 2018/19 tax return on or before 12th March 2020 and included your ridesharing business income (including other income on your ABN) in your tax return (If you lodged a little later, the Commissioner may accept your application but on a case by case basis) or
- You’ve lodged Business Activity Statements (BAS) before 12th March 2020 and reported your earnings during the period 1st July 2018 to 12th March 2020.
- You were actively engaged in the business;
- You are not entitled to another JobKeeper Payment (either a nominated business participant of another business or as an eligible employee);
- You were a resident for Australian tax purposes on 1 March 2020; and
- You were an Australian citizen, the holder of a permanent visa, or a Special Category (Subclass 444) Visa Holder at 1 March 2020.
30% Reduction in your Gross Income.
To demonstrate that your gross income (before expenses) has reduced or is likely to reduce by 30% or more, you will be expected to show that your gross income has fallen or will likely fall in the relevant quarter compared with the same time a year earlier. For example, you would compare your March 2020 BAS gross income with your March 2019 gross income.
If you weren’t ridesharing or you weren’t earning any income on your ABN last year, or where your gross income a year earlier was not representative of your usual or average gross income, (for example, you were only driving a few days a week last year compared with full time now), the Tax Commissioner will have discretion to consider additional information that the you could provide to establish that you have been adversely affected by the impacts of the Coronavirus.
There are two ways to get accepted into JobKeeper: either passing the turnover test, or the ‘alternative’ test. The two methods are explained here.
More information on this can be found here.
If you’re employed by another employer and driving Uber on the side, then you can only claim the Jobkeeper payment once. It is best that you ask your employer to claim this on your behalf so that when COVID-19 is over and everything goes back to normal, you can return to employment and also continue with Uber.
How to apply?
You can now apply for the JobKeeper Payment through the following steps:
- If you haven’t already done so create a myGovID
- Once you have created a myGovID you will need to apply through the Business Portal
- Now complete the form through the Business Portal by selecting ‘VIEW’ then ‘ENROL’
- Login to your myGov account
- Select Australian Taxation Office
- Select ‘VIEW’ where it says COVID-19
- Scroll down to Step 2 – ‘Identify and maintain employees eligiblefor JobKeeper wage subsidies’ and select ‘Identify’
- Select ‘Next’
- Select which month you are applying for JobKeeper wage subsidy. (April 2020 or May 2020).
- Where it says JobKeeper status select ‘Claim FN 1 and 2’. You will be paid JobKeeper from 30th March 2020 if your decline in turnover was April 2020.
- Do you want to add eligible employees? Select ‘NO’ for this option. Then select ‘NEXT’
- Enter current April 2020 GST turnover and your projected May 2020 GST turnover
- Sign the declaration and hit ‘SUBMIT’
STEP 3 – How to report each month until the end of September 2020.
- Login to your myGov account
- Select Australian Taxation Office
- Select ‘VIEW’ where it says COVID-19 Access ATO measures and tailored support such as JobKeeper wage subsidy and early release of Superannuation.
- Scroll down until you see Step 3 Business monthly declaration for JobKeeper payment. Select ‘DECLARE”
- Enter current May 2020 GST turnover (gross sales before expenses) and your projected June 2020 GST turnover (gross sales before expenses) can get your May 2020 GST turnover from the Rideshare Tax app if you have linked your Uber account and entered all your Income if you drive for DiDi, OLA, and Shebah or any other income you receive. To do this in the Rideshare Tax app 1. Select Home screen 2. Select Monthly 3. Select May 2020. For June 2020 GST turnover you only need to estimate how much income you think you will earn for the month. Remember this is only an estimate you won’t be penalised from the ATO if this is incorrect.
- Tick the Declaration box and hit ‘SUBMIT’. You should receive a confirmation from the ATO once it has been successfully lodged.
Can my Tax Agent apply for me?
Yes, your tax agent may apply on your behalf.
FAQ for Jobkeeper
I’ve been ridesharing for a few years but I have some tax returns and BAS outstanding, can I claim the Jobseeker payment?
The short answer is no. The eligibility criteria requires you to have either lodged your 2018/19 income tax return or a BAS lodgement which reports your earnings during the period 1st July 2018 to 12th March 2020. If you haven’t completed either of these, then you are not entitled to Jobseeker however, you can claim the Jobseeker instead. More information on Jobseeker is available below.
I’m a rideshare driver and I haven’t lodged my 2019 tax return but my BAS’s are up to date, can I claim the Jobkeeper payment?
Yes, provided you meet the other eligibility criteria mentioned above.
I’m a rideshare driver and I haven’t lodged my 2019 tax return, can I claim the Jobkeeper payment?
No. But if you’ve lodged your BAS’s on or before 12th March 2020 covering the period 1st July 2018 to 12th March 2020 then you can claim the Jobkeeper payment. Otherwise, you may be entitled to the Jobseeker payment. More information on Jobseeker is available below.
I started rideshare driving after 1st January 2020, can I claim the Jobkeeper payment?
Unfortunately, no. Due to the eligibility criteria mentioned above, if you started rideshare driving after 1st January 2020, then you are not eligible for the Jobkeeper payment. The reason is because you need to have lodged a BAS prior to 12th March 2020 and considering the 3rd quarter BAS closed off on 31st March 2020, you would have missed this cut-off date. You can claim the Jobseeker instead. More information on Jobseeker is available below.
I earned other income on my ABN for a few years but I started ridesharing after 1st January 2020, can I claim the Jobkeeper payment?
Yes, if you’ve lodged your 2019 tax return and included that income in your return and you also meet the other eligibility criteria mentioned above. If you haven’t lodged your 2019 tax return, then you’re not entitled to the Jobkeeper payment but you may be entitled to claim the Jobseeker instead. More information on Jobseeker is available below.
I’m a food delivery driver and I haven’t lodged my 2019 tax return, can I claim the Jobkeeper payment?
No. Part of the eligibility criteria is that you must have lodged your 2018/19 tax return on or before 12th March 2020. You can claim the Jobseeker instead. More information on Jobseeker is available below.
Can I claim the Jobseeker until my Jobkeeper payment commences?
Yes you can is the short answer. However, you can only claim one payment. If your payment for the Jobseeker has already commenced, then your payments will stop once your payment for Jobkeeper commences because you must report your Jobkeeper payment to Centrelink. If you do not report the income or cancel your JobSeeker Payment, you may incur a debt that you will be required to pay back.
My employer said I am eligible for the Jobkeeper payment, should I apply as well as a sole trader?
No. Your employer will apply on your behalf.
For more information on the Jobkeeper please visit Support for Sole Traders Factsheet
Now that I am receiving JobKeeper payments can I still work?
Once your application has been approved for JobKeeper (e.g. you passed the 30% decline in turnover test for March and April 2020) you will be eligible as a sole trader to keep receiving payments until the end of September 2020. You can also earn as much as you like as there is no cap or limit on the amount you may earn!
The only requirement is to make sure your business is still active, and the ATO defines active as making sure your BAS and tax lodgements up to date! So remember to keep your tax lodgements up to date to keep receiving your JobKeeper payments.
Can Rideshare Tax assist with my JobKeeper application?
Yes, we can but only if you have lodged your BAS or tax return and you are a client of Rideshare Tax. If you have recently lodged your BAS or tax return and are a client with Rideshare Tax please let us know if you require assistance.
Option 2: Jobseeker
What is it?
Sole traders which cover Uber and all Rideshare drivers impacted by the Coronavirus will be able to access the Jobseeker subsidy from the Centrelink. Jobseeker is an income support payment to assist the unemployed. If you’re not eligible for the Jobkeeper payments, then you may be eligible for the Jobseeker payment instead.
How much you can get?
JobSeeker Payments are made every 2 weeks. Your payment amount will depend on your circumstances.
|Your situation||Your maximum fortnightly payment|
|Single, no children||$565.70|
|Single, with a dependent child or children||$612.00|
Further information on Jobseeker available the Centrelink website
In addition to the usual payment for these benefits the Government are introducing the additional Coronavirus supplement of $550 per fortnight to both existing and new recipients plus two one-off $750 Payments to Support Households for the next 6 months and you will not be income tested.
The benefit you receive is subject to your income reported to Centrelink, and will vary according to your personal circumstances.
Rent Assistance is also available for Jobseeker payment recipients. For more information please see the Centrelink website.
The Coronavirus supplement will commence from 27 April 2020.
Who is eligible?
As a rideshare and/or food delivery driver, you need to have experienced a decrease in income as a result of the COVID-19 pandemic. Eligibility is based on income earned per fortnight, as reported with Centrelink via online services.
The partner income test has been increased to $79,000 (from $48,000).
Is there GST on this?
The income you receive from Centrelink will not be reported in your BAS and does not attract GST. You will not need to enter this income in the Rideshare Tax app.
How to apply?
There has been a huge influx of application at Centrelink and they’re struggling to keep up. Do not go into the Centrelink office. Instead, click on the “Register Intention to Claim” button through MyGov and leave your details. Someone will contact you and help you with your application.
You don’t need a Centrelink Customer Reference Number (CRN) to register your intention to claim. Centrelink will contact you and confirm your identity and give you a CRN if you don’t have one already.
You will need your 2018/19 and current year Profit and Loss Statement when completing your application. If you would like to speak to a Rideshare Tax Accountant, please book a free 10 minute call and we can assist you through this process.
For more information about Jobseeker, visit the Services Australia website
Other benefits available for rideshare and food delivery drivers:
We have prepared fact sheets on the other benefits available to rideshare and food delivery drivers.
Business Activity Statement (BAS)/GST and Tax Return Obligations
You’re still required to lodge your BAS’s and end of year tax return. If you’re unable to pay your BAS and tax due to COVID-19, you can contact the ATO to arrange a payment plan.
Depending on your personal circumstances, you may even be entitled to a refund due to the significant reduction in income you’ve experienced due to COVID-19. This is only possible if your income is less than your expenses. Or if you had full-time employment, then the loss from your rideshare business could offset against your PAYG income and result in a refund. But of course, this based on an individual basis.
Pay As You Go PAYG Installments
You may wish to adjust your PAYG Installment amount due to the reduction in your rideshare income.
If you’re struggling to make your mortgage repayments, please contact your bank and discuss your options. You may be able to stop repayments for a period of 6 months (the payments will be added to your loan balance) or you could reduce your payment amount.
Options available include:
- Deferring BAS payments by up to six months (including PAYG instalments) and income tax assessments.
- Allowing businesses to vary PAYG installment amounts to zero for the March 2020 quarter. Businesses that vary their PAYG installment to zero can also claim a refund for any installments made for the September 2019 and December 2019 quarters;
- Remitting any interest and penalties, incurred on or after 23 January 2020, that have been applied to tax liabilities;
- Working with affected businesses to help them pay their existing and ongoing tax liabilities by allowing them to enter into low interest payment plans;
- If you want utilise any of these options you can contact the ATO.
For more information visit the ATO website for Additional support during COVID-19
Other Government Support Available
The below are other government support packages available at state and national level.
Do you need help?
It may seem overwhelming to navigate your way through all the questions and to know what will work best based on your personal financial circumstances. If you would like to book an appointment with Rideshare Tax and speak to one of our CPA accountants
Do you have any questions? Leave a comment below and the Rideshare Tax will respond.