Bonus: How Much Tax Will You Save
Now that weve covered all the basics, Ill show you some detailed tax calculations covering the most common driver scenarios when buying a new car for Uber. This is all fairly technical, so if youre unsure about how these calculations work I strongly advise having DriveTax or another tax agent prepare your tax return this year. I have studied the new depreciation legislation inside-out, and can advise you how to get the best overall tax deduction for your new car based on your specific personal circumstances.
In the following examples, the important thing to note is that depending on your business profit and your overall taxable income, you may get the full tax benefit from your car purchase, you may only get part of the tax benefit, or in some cases you may get no tax benefit at all.
These six scenarios below are only some of the potential outcomes, which goes to show exactly how complicated the depreciation rules are this year and how many variables are involved in calculating the best possible outcome.
Example 1 Still have a business PROFIT after deducting car purchase, and overall taxable income is ABOVE tax-free threshold
- Uber Net Profit = $44,000
- Logbook = 80%
- Tax Deductible Cost = $20,000 x 80% = $16,000
In this example, the driver would get the full tax benefit of their car purchase based on their marginal tax rate.
Does Driving For Uber Affect My Insurance Price
Your regular personal insurance is made to meet your personal use. If you are planning to work for Uber, you must let your insurance company know.
Although you don’t need commercial insurance when working for Uber, your insurance company will not pay for any claims if they learned that you were involved in an accident when working for Uber.
Moreover, it might get to canceling your insurance policy if you did not be clear with them from the beginning.
Best Affordable Car: 2016+ Kia Soul
Thanks to its boxy design, this little Kia has a surprising amount of room for passengers, and its distinctive look makes it easy to spot in a sea of sedans and SUVs. CR praised the Soul for its abundant interior space and super-easy access, some of the very qualities that make for a good ride-share experience. Despite its affordable price, the Soul has options like leather seats. In addition, forward-collision warning became available starting in 2016.
CR recommends active safety features for all drivers, but they can be especially important for ride-share drivers.
Drivers are putting a lot of miles on their car, and they do get into accidents, Campbell says. Youre protecting yourself but also your passengers.
See the complete Kia Soul road test, reliability, and pricing.
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Uber Driver Online Screening
As part of your application, you will be required to undergo an Uber background check online.
This screening will review your criminal record and driving history. If you have a history of reckless driving or a driving record full of insurance claims, you will likely not pass the online screening. You can check your driving history here:
Uber uses a company called Checkr for the initial screening and for annual background and driving check refreshes on their drivers.
They may also run additional checks to comply with new local laws or if the background check standards have changed. Unfortunately, there is no way to predict when Uber will run its annual check.
The official driving record and criminal history check are paid for by Uber. If you arent sure youll pass, you can pay to check your background and driving history before applying.
Uber does not perform a credit check so if you already have a vehicle that meets Uber vehicle requirements, your credit score and background will be irrelevant.
Uber does not drug test its drivers, but the police officers in your state might if you are pulled over for a traffic infraction.
Uber Eats Driver Requirements: Car Scooter And Bicycle
March 12, 2019 By Kathryn Vercillo
The Uber Eats driver requirements are more flexible than those for regular Uber drivers. The requirements are the same if youre planning to deliver Uber Eats by car. However, you can also deliver Uber eats by scooter or bicycle. Therefore, you have more options available to you. Those options do vary by location, so even though weve provided extensive information on the topic below, its important to note that your own experience might differ depending on where you live.
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Use The Direct City Url
The last option you can use is to input your city’s URL link directly.
Like most of the organized websites on the web, Uber’s website uses a specific structure for its URL links. Therefore, smart people took advantage of this structure and came up with the direct city URL method.
In this method, you need to use the following link and change the word *city to your city’s name:
uber.com/us/en/drive/*your-city*/vehicle-requirements/
Uber Economy Shared Rides: Uber Pool Uber Express Pool
- Uber Express Pool
- Uber Pool
What is the difference between Uber Express Pool and Uber Pool?
Uber Express Pool and Uber Pool are both cheap Uber rides. They allow you to pay less because you share the carand the route with other Uber users going in your same direction. Do not worry Uber App automatically calculateseverything by itself. The big difference between Uber Express Pool and Uber Pool is in the Pickup and Drop off.
If you use Uber Express Pool, you will probably need to walk a couple of blocks to get to the pick-up spot andwalk up to a couple blocks from your Express drop-off spot close to your destination.
If you choose UberPool, the pickup and drop off locations are exactly the ones you indicated when choosing yourride and you will not have to walk. Obviously these types of rides are cheap but they are not the most appropriateto choose if you are in a hurry.
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Can I Buy A Car Before Getting Approved In Uber
Many people felt confident when applying to Uber and decided to buy the car before hearing the approval. Lots of these people got rejected for different reasons as a result, they had to deal with monthly payments they did not afford.
That been said, experts recommend that you never go ahead with purchasing the vehicle until you are approved. You could mention in the application that you need a car.
Uber Car Types: Simply Explained
This article will show you the different uber car types, that way you know what to order.
Uber is a ride-hailing transportation company founded in 2009 and is well known for its taxi phone app of the same name. As of December 2018, Uber was available in 63 countries and over 700 cities worldwide. It also had 91 million monthly active platform consumers and 3.9 million drivers.
Over the years since its launch, Uber has changed the way people view transport by making it fun, cheaper, and way more convenient. Whether youre running an errand across town, going to an airport, or exploring a city far from home, getting there should be easy.
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Things To Consider When Choosing What Kind Of Car For Uber
As our list goes to show, there isnt just one best vehicle for Uber which option is best for you will very much depend on your unique circumstances. Below we outline a few key factors to bear in mind:
- Town or Highway
If you plan on conducting the majority of your work in and around a town or city, a compact hybrid vehicle is probably your best option. Conversely, for drivers who regularly undertake longer journeys on the highway, something a little larger may be preferable. Terrain will also make a difference if challenging weather conditions are the norm where you live, you might consider an all-wheel drive vehicle.
- Running costs
When your income depends upon your car, running costs are crucially important! Thats why weve suggested vehicles which are very fuel efficient, and included so many hybrid options.
- Safety
Safety should always be top of the list when selecting a car, but especially so when youll be using it so much and driving so many passengers. Weve deliberately populated this list with cars which have high safety ratings, for your peace of mind.
- Comfort
The more time you spend in your car, the more important comfort becomes. When selecting a car for Uber, its important to bear this in mind your passengers will thank you too!
Uber Driver Age And License Requirements
You need at least one year of driving experience in the United States unless youre under the age of 23.
In that case, you need at least three years of driving experience.
How Old Do You Have to Be to Drive for Uber?
You need to be at least 21 years old to drive for Uber.
Is There a Maximum Age to Drive for Uber?
No, as long as youre older than 21, there arent any other age requirements.
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What Is The Uber Vehicle Inspection
Before you start driving for Uber, your vehicle has to pass the vehicle inspection. Once you become a driver, you need to pass this control once a year. What are some of the requirements to pass this control?
- passenger doors that open independently
- working seat belts
- working air conditioning
- no visible cosmetic damages
The vehicle inspections take place in places called Uber Greenlight Hubs. They usually take about half an hour.
Does My Car Qualify To Drive For Uber
The first step to driving for services like Uber and Lyft is having a car that qualifies for their services. The standard Uber service, Uber X, is the most Uber request that takes place, with additional services, like UberSUV or UberBlack which impose additional restrictions on your car. This guide will take you through the general requirements for each Uber service to let you know whether or not you can drive for Uber. However, its important to know these are general guidelines. To drive for Uber, you must pass a vehicle inspection as well as a general background check. You may pass all the requirements for a given service, but still fail the vehicle inspection if your car is not in good condition, so be careful of holding these guidelines as absolute.
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Uber Comfort Car’s Requirements
The fourth option of Uber is Uber Comfort. Uber Comfort is a new option that is being tested currently. It mostly focusses on having more room for the passengers. While it seats four passengers like the regular UberX, it provides more headroom and legroom for them.
While it provides more room for the passengers, Uber Comfort still costs less than the UberXL. So, it is somewhere between the UberX and the UberXL.
Uber Comfort is usually requested by passengers who are coming from airports or do not like to ride a compact car.
Some of the specific requirements for Uber Comfort are:
- Driver’s record
To be eligible to join the Uber Comfort option, there are some requirements for the driver himself. For instance, you must have more than 250 rides with Uber with a rating of no lower than 4.85.
That been said, if you are new to Uber, you might need to look at other options first, create a good history with Uber, and then look into joining Uber Comfort.
- Vehicle’s room
As we mentioned earlier, one of the main aspects of Uber Comfort is the vehicle’s room. Therefore, you must have a car with a lot of legroom. If your car is very small, you are not eligible to join the Uber Comfort option.
Most Uber Comfort vehicles must be relatively new. They are usually newer than UberXL.
- Uber Comfort Vehicles examples
Claiming An Existing Car
If you start doing rideshare or food delivery and you use a car that you already own, you may be able to claim the instant asset write-off. You will first need to calculate how much the car has depreciated between the date you bought it and the date you started using it for business purposes. This is calculated using the diminishing value method and an effective life of 8 years. This calculation is too complex for me to explain in full here, so if this scenario applies to you I recommend having your tax return prepared by DriveTax or another tax agent and have it calculated for you. From there, you can claim the Instant Asset Write-Off or Temporary Full Expensing on the remaining value of your car.
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Uber’s Free Inspection Centers
Uber offers inspection locations called Greenlight Hubs or Greenlight Spots. These are centers that can not only help you do a free inspection but also help you complete your application and upload your documents to the system.
To find the closest free inspection center to your address, you need to do a specific google search that limits the results to uber.com pages.
Simply enter this statement in the google search bar: *your city* vehicle inspections site:uber.com and replace the *your city* with your city’s name. For instance, if you are looking for free inspection centers in Chicago, you can search for Chicago vehicle inspections site:uber.com.
Another simple way is to enter the URL directly. You can do so by typing this statement to your URL bar uber.com/us/en/drive/*your-city*/inspections/ and make sure to replace the *your-city* with your city’s name.
The link will take you to a page that has a map showing all free inspection centers in your city.
Claiming Depreciation On A New Car For Uber
If you have bought a car during the financial year, we strongly recommend having your tax return prepared by DriveTax or another tax agent.
The tax legislation behind car depreciation is more complex than its ever been before, the tax return form itself is confusing, and there are traps that could mean you end up with a less-than-optimum tax result.
When we prepare your tax return, well explain how the Instant Asset Write-Off or Full Expensing rules will work for your specific tax circumstances. Well run all the calculations and analyse your options to make sure your tax deduction for your new car is maximised.
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Minimum Uber Car Requirements
- A 15-year-old vehicle or newer
- 4-door vehicle
- Good condition with no cosmetic damage
- No commercial branding
- Must display Uber decal
Uber also requires the vehicle your drive to have both registration and insurance. Interestingly enough, the registration doesnt have to be in your name, but the VIN on the insurance must match the VIN on the registration. Our recommendation to be on the safe side is to try and have your name on everything to eliminate any confusion.
Now onto Lyft
Best Used Cars For Uber And Lyft Drivers
Consumer Reports has no financial relationship with advertisers on this site.
Drivers for ride-hailing services such as Uber and Lyft have had a difficult few years. Their earnings fell as demand for travel evaporated, and those who did drive during the early days of the pandemic did so at great risk. Now, even as demand for ride-hailing increases, rising gas prices are cutting further into their profits.
Before the pandemic, we spoke with Harry Campbell, a ride-share consultant at therideshareguy.com, who told Consumer Reports that drivers put as much as 1,000 miles a week on their cars. For that kind of heavy-duty driving, the things many people want in a carreliability, fuel efficiency, comfort and safetybecome critical.
We also looked at new information from the personal finance data service ValuePenguin, which estimates that a ride-share drivers expenses increase by 25 percent and profits dip by 12 percent for every four gas fill-ups in a month. We also studied online forums to find out the challenges Uber and Lyft drivers face. Then we looked at the results of our Annual Auto Surveys to find out which affordable used cars are best at meeting those challenges. We didn’t recommend any new cars because they depreciate too quickly to make much financial sense for ride-share drivers.
Some of these models carry our new Green Choice designation, which highlights vehicles with the cleanest emissions.
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Claiming Deductions For Other Ownership Options
- Lease or Rental: You can claim a tax deduction for the cost of your lease/rental repayments for the year multiplied by your logbook percentage. You cannot claim the cost of buying the car itself, because technically it is the lease/rental company who purchased the car, not you. Heres more on Renting a Car for Uber.
- Salary Packaging: You cannot claim a tax deduction for salary packaged expenses, because you have already received the tax benefit through the salary packaging. You can claim any expenses you pay for out of your own pocket as long as you have kept a logbook.
In all of the above situations, you MUST keep a valid ATO-compliant logbook to claim these deductions, even if your use is 100%. Otherwise you cannot claim the instant asset write-off, depreciation, loan interest, fuel or any other car running costs, and youll instead be limited to just the cents per kilometre method, which is a maximum tax deduction of $3,600. See our blog post on Tax Deductions for Uber Drivers for more information on keeping a logbook.
