Uber and Rideshare Taxes
Uber and Lyft drivers: GST/HST from the first fare, the quick method, vehicle deductions and what it costs in tax.
The short version
- Uber, Lyft and other rideshare drivers are self-employed. Fares go on form T2125 as business income, and you pay both halves of CPP on the profit.
- Rideshare drivers must register for GST/HST from their first fare. The $30,000 small supplier exemption doesn't apply to taxi and commercial ridesharing services.
- You deduct the business share of your vehicle costs (from a logbook), the app's service fees, your phone, and capital cost allowance on the car.
- Many drivers use the GST/HST quick method: in Ontario, you remit 8.8% of HST-included fares instead of tracking input tax credits on most expenses.
- The app reports your earnings to CRA, and sends you an annual tax summary. Use it, but check it against your own records.
Uber and Rideshare Taxes in Canada
Rideshare driving has a tax profile all its own. You're a business from the first trip, a GST/HST registrant from the first fare, and your biggest expense is the car you also drive to the grocery store. Get the logbook and the HST right, and the rest is ordinary self-employment. Get them wrong, and the CRA letter usually arrives two or three years later, with interest.
What Rideshare Income Looks Like on Your Return
| Item | Where it goes |
|---|---|
| Gross fares (before the app's fees), tips, bonuses and incentives | T2125, gross business income (excluding the GST/HST you collected) |
| App service fees and booking fees charged to you | T2125 expense |
| Vehicle costs, business-use share | T2125 motor vehicle section |
| CCA on the car | T2125 CCA area (class 10 or 10.1) |
| Net profit | Line 13500 of your return; CPP on Schedule 8 |
Your app's annual tax summary shows gross fares, fees and the tax collected. Some figures on it are amounts the rider paid that you never saw, such as booking fees; read it line by line, or have the document analyzer read it for you.
What will rideshare driving cost me in tax?
Enter your fares, kilometres, expenses and province. The assistant estimates your vehicle deduction, income tax and CPP, and what to set aside from each weekly payout.
GST/HST: Registered From Day One
Taxi and commercial ridesharing services aren't eligible for the small supplier exemption, so you must register for a GST/HST number before you start driving, even if you drive only a few weekends a year. Then you file GST/HST returns, usually annually.
Whether the app collects the tax and passes it to you, or handles part of it for you, depends on the platform and has changed over the years. Check your platform's tax settings and summary. Either way, the GST/HST return is filed under your number, and it's your obligation.
The Quick Method, With Numbers
| Ontario driver, fares of $40,000 plus 13% HST | Regular method | Quick method |
|---|---|---|
| HST collected | $5,200 | $5,200 (kept within $45,200 fares) |
| Input tax credits on gas, repairs, phone, fees (business share) | About ($1,800) | Not claimed (except on capital purchases like the car) |
| Remittance | About $3,400 | 8.8% x $45,200 = $3,978, less 1% credit on the first $30,000 = $3,678 |
In this example the regular method wins, because rideshare costs carry a lot of HST. With lower expenses, the quick method can come out ahead, and it's always simpler. Run both in your first year before you elect; the full rate table is on the quick method. Quick method rates outside Ontario are different: in GST-only provinces, a service business remits 3.6%.
Rideshare GST/HST return due?
Enter your fares, the tax collected and your expenses. The SmartFile compares the regular and quick methods, tells you which saves more, and prepares the return for you to file.
The Car: Logbook, Expenses and CCA
You can deduct only the business-use share of the car: business kilometres divided by total kilometres. For rideshare, business kilometres generally include driving with a passenger and driving to pick one up; time spent waiting for requests from home or driving to your first trip of the day is where CRA and drivers sometimes disagree, so note how you count it.
- Running costs: gas, insurance (including rideshare coverage), repairs, tires, car washes, licence and registration, the business share of lease payments or loan interest.
- CCA: 30% a year on the declining balance (class 10, or class 10.1 for passenger vehicles over the $39,000 ceiling for 2026); see capital cost allowance explained.
- Records: keep a mileage log for the full year, or a full one for a base year plus a three-month sample in later years. The app's trip log helps but doesn't record your total kilometres.
The full rules and limits are on vehicle expenses for self-employed.
Other Deductions
- The business share of your phone and data plan.
- Dash cam, phone mount, chargers, cleaning supplies, water and mints for passengers.
- Parking (not parking tickets, which are fines).
- Accounting fees for your T2125 and GST/HST return; see accounting and legal fees.
What It Costs in Tax
Say you net $30,000 after all expenses, with no other income, in Ontario. The 2026 income tax is about $2,460 and CPP about $3,150, about $5,600 in total. CPP is often the bigger bill for full-time drivers, because the basic personal amount covers most of the income tax at that level. Run your own numbers on the self-employed tax calculator, and see how much to save for taxes.
Employee or Contractor?
Ontario's Digital Platform Workers' Rights Act, in force since July 1, 2025, gives rideshare and delivery workers a minimum wage for their engaged time and other protections. It doesn't turn them into employees for tax purposes: you're still self-employed with CRA unless a ruling says otherwise. See contractor vs employee.
If you never registered or filed GST/HST, it gets more expensive the longer it waits. See unfiled tax returns, and delivery driver taxes if you also deliver food or parcels, which follow different GST/HST rules.
Rideshare Tax Questions
Do Uber drivers have to register for GST/HST in Canada?
Yes. Commercial ridesharing drivers must register for GST/HST from their first fare, regardless of how much they earn. The $30,000 small supplier exemption does not apply.
How do Uber drivers report income on their tax return?
On form T2125 as self-employment business income: gross fares, tips and incentives, minus app fees, vehicle and other business expenses. The net profit goes on line 13500, with CPP calculated on Schedule 8.
Can rideshare drivers use the quick method?
Yes, if annual taxable supplies including GST/HST are $400,000 or less. In Ontario the quick method remittance rate for a service business is 8.8% of HST-included fares.
What vehicle expenses can an Uber driver deduct?
The business-use share of gas, insurance, maintenance, repairs, licence fees, lease payments or loan interest, plus capital cost allowance on the vehicle, supported by a logbook.
Does Uber report my income to CRA?
Platforms are covered by the reporting rules for digital platform operators, so ride income is reported to CRA each year.
Sources: CRA, Tax obligations for commercial ridesharing and delivery services; RC4058 Quick Method of Accounting for GST/HST; Gig economy; Ontario, Rights and protections for digital platform workers. Checked October 2026. The tax figures come from our 2026 Ontario rules engine; the quick method comparison is illustrative. We could not confirm how each app currently handles GST/HST collection for drivers, so check your platform's summary. Which waiting and repositioning kilometres count as business use is not settled for every situation.
Last reviewed October 4, 2026 against CRA and Government of Canada sources. How we check our facts.