The collaboration comes as the ATO pursues approximately 10,000 taxi and rideshare drivers for a debt of $40 million.
Fintech partners with rideshare platform for gig economy tax services
Accounting fintech TaxLeopard has partnered with rideshare platform DiDi to help support rideshare drivers to meet their tax responsibilities.
The growth of the gig economy has seen thousands of individuals turn to side hustles to supplement their income such as rideshare drivers, however, many failed to realise the financial implications and tax obligations that come with these alternate employments.
With approximately 10,000 taxi and rideshare drivers currently being pursued by the ATO for a combined debt of $40 million, it is clear that tax compliance within the gig economy is a pressing concern.
ATO assistant commissioner Tim Loh warned individuals to abide by the tax commitments no matter the income source.
“While there are always new and different ways to make money, the tax obligations remain the same,” said Mr Loh.
“Don’t fall into the trap of forgetting to include all your income thinking the ATO won’t notice.”
The ATO increased its efforts to collect unpaid taxes from gig economy workers through the Sharing Economy Reporting Regime, whereby the Tax Office scrutinises financial information by not only employing data-matching techniques, such as bank transactions but also receiving data directly from the rideshare provider to ensure that individuals were paying the correct amount of tax.
The collaboration between TaxLeopard and DiDi occurred after it recognised the complex nature of tax obligations for those in the gig economy and endeavoured to simplify tax compliance for drivers.
TaxLeopard demonstrated the complexity through an example.
“Rideshare drivers, classified as self-employed individuals, bear various costs, including vehicle insurance, workers’ compensation, superannuation and income tax,” the firm said.
“Unlike most businesses exempt from registering for Goods and Services Tax (GST) for turnovers below $75,000, rideshare drivers, such as those working with Uber, are obligated to register from the first dollar earned.”
“GST, calculated as 1/11th of each fare, further adds to the complexity of tax obligations for rideshare drivers.”
Co-founders of TaxLeopard, Selda Kaplan and Michael Kambouridis, said the goal of the collaboration was to help transform tax compliance for those in the share economy.
“The collaboration between TaxLeopard and DiDi represents a significant step forward in revolutionising tax services for rideshare drivers in Australia. Our advanced technology, and expert knowledge aim to simplify tax compliance, reduce financial stress, and foster success for rideshare drivers,” said Ms Kaplan.
“By partnering with DiDi, we’re providing rideshare drivers with the tools and support they need to navigate the complex world of taxes,” said Mr Kambouridis. “Our goal is to empower drivers to meet their tax obligations and achieve financial peace of mind.”
TaxLeopard said the partnership provides a user-friendly platform that allowed drivers to manage their tax obligations efficiently with drivers able to track their income, expenses and GST liabilities in real time.
It said the platform has integrated Yodlee with open banking, allowing users to link their bank accounts and download their income and expenses into the TaxLeopard platform.
TaxLeopard said the partnership also allows simplified record-keeping for rideshare drivers as the platform facilitates the tracking and categorisation of business-related expenses.
“By combining advanced technology, real-time data integration and expert knowledge, TaxLeopard and DiDi aim to simplify tax compliance, reduce financial stress and foster financial success for rideshare drivers,” said the firm.