Suitable for: Anyone who is a rideshare driver
Tax Difficulty: Beginner
Airtax Experience: First time users
Time to Read: 2-3 minutes
As a rideshare driver, your mobile phone is a critical tool for you to accept trips and ultimately earn your business income. In this article, we’ll explain why expenses relating to your mobile (including data, and phone plans) are claimable, and along the way, we’ll link this back to the key conditions that need to be met in order to claim an expense on your BAS. Claiming this expense on the BAS is an important step towards optimising your tax position each quarter.
The skills you learn in this article are transferable to other expenses you incur as a rideshare driver, so it's a great place to start if you're unsure about your BAS expense claims. If you are a freelancer or another type of sole trader, your mobile phone bill may still be relevant for your BAS, however this article covers rideshare drivers specifically.
To start, a quick reminder of the conditions an expense needs to meet in order for it to be claimable in your BAS (all must be true):
- The purchase is made at least partly for your business activity, and it does not relate to making input-taxed supplies.
- The expense amount included GST.
- You have paid for the expense during the BAS period
- You have a tax invoice from the seller, for purchases over $82.50 (inc. GST)
How we can apply the above criteria to your monthly mobile phone bill:
- Is the purchase made at least partly for your business activity? You need to have a working phone with mobile data in order to connect to Ola, Uber, Didi, or other rideshare platforms and accept trips, so this is met.
- Did the expense amount include GST? In order to claim GST back on a purchase through your BAS, the expense has to actually include GST. With respect to your phone bill, this will pretty much always be the case (however you should always triple check your tax invoice to be sure).
- Have you paid for the expense during the BAS period? Assuming you are registered to report BAS on a quarterly basis, you should list expenses in the BAS period in which you actually paid for them. For example, if you pay your phone bill on the first of each month and report BAS quarterly, you would total up each monthly charge in the BAS period and report the total.
- Do you have a tax invoice from the seller? This one is normally an easy one, as the phone/data provider should provide you with a tax invoice via email or mail.
By using these four steps, we can see that your phone and mobile internet bill is a simple expense you should avoid forgetting next BAS lodgement.