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Perth carpooling app’s no income tax claims rejected

All rideshare drivers are being warned they need to declare income no matter how little they earn after a carpooling start-up claimed it wasn’t necessary while trumpeting ambitious plans.Spruiking her yet-to-launch ReddyRide app, founder Sharon Wilkins said drivers would offset the costs of their daily commute by picking up others along the way and charge…

All rideshare drivers are being warned they need to declare income no matter how little they earn after a carpooling start-up claimed it wasn’t necessary while trumpeting ambitious plans.

Spruiking her yet-to-launch ReddyRide app, founder Sharon Wilkins said drivers would offset the costs of their daily commute by picking up others along the way and charge a small fee per kilometre, with passengers only paying less than one-quarter of the price of rideshare services such as Uber.

Ms Wilkins claimed most drivers “won’t have to declare it as a taxable income because the amount they receive is less than the operating cost of their car”.

The Australian Taxation Office, however, says income tax applies to all ride-sourcing income.

“No matter how little you earn through car sharing, you must declare it in your tax return,” a spokesperson said in an emailed statement on Tuesday.

“However, drivers are entitled to claim some deductions.

“The expenses claimed must relate directly to the renting, hiring or sharing of your car, and accurate records such as receipts must be maintained to back up all claims.

“The ATO recommends using the myDeductions tool in the ATO app to record the income and the kilometres travelled for sharing purposes.

“The information can then be sent directly to the ATO or to your tax agent for pre-filling at tax time.”

ReddyRide also claims drivers will not have to supply an ABN.

Again, not true, the tax office says.

“All ride-sourcing drivers need to have an Australian business number (ABN) and be registered for GST.”

ReddyRide says it will earn revenue by taking a small cut from each fare and plans to promote its app using funds raised from an equity crowdsourced share offer.

Richard Wilkins, Sharon’s father and founding partner of the business, says the service could “grow into a potentially global entity”.

“First stop Perth, then Australia, then the world,” he said in press release on Tuesday.

ReddyRide says the equity crowdsourced share offer will be managed by Birchal, which broke Australian records when it raised $3 million for Shebah, a ridesharing app exclusively for women.

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