At present, we can't claim a GST input tax credit on the commission we pay to Uber. This is because Uber doesn't charge us GST on the commission. It doesn't need to as the GST law now applies because we pay the commission to a foreign-resident entity, which is based in the Netherlands.
The position, however, can be expected to change from 1 July 2017 because of amendments to the GST law that the Australian Parliament has already enacted to give effect to a 2016-17 Budget measure.
The amendments were in the Tax and Superannuation Laws Amendment (2016 Measures No. 1) Act 2016, which received Royal Assent on 5 May 2016. These measures, however, apply only from 1 July 2017.
The amendments ensure that GST is applied consistently to the supply of digital products and other imported services.
I expect that if this legislation affects it (as I consider likely), Uber will charge us a separate GST charge on top of the commission it already charges us. We will then be able to claim a GST input tax credit against the GST we pay as drivers.
This is conceptually correct. Note, however, we will be worse off from a timing perspective as we will need to pay the GST each time we pay the commission but obtain the benefit of the input tax credit up to several months later.
Uber continues to charge us commission on the GST component of our fares, which strikes me as a double dip, unfair and wrong in principle. We can only hope that if Uber does pass on the GST on the commission to us as drivers, it takes the opportunity to remove its commission on the GST component of the fares. But don't hold your breath on that one.
For more information about the recent amendments to the GST law, see https://www.ato.gov.au/General/New-...axes/GST/GST---applying-to-digital-products-and-services-imported-by-consumers/.
The position, however, can be expected to change from 1 July 2017 because of amendments to the GST law that the Australian Parliament has already enacted to give effect to a 2016-17 Budget measure.
The amendments were in the Tax and Superannuation Laws Amendment (2016 Measures No. 1) Act 2016, which received Royal Assent on 5 May 2016. These measures, however, apply only from 1 July 2017.
The amendments ensure that GST is applied consistently to the supply of digital products and other imported services.
I expect that if this legislation affects it (as I consider likely), Uber will charge us a separate GST charge on top of the commission it already charges us. We will then be able to claim a GST input tax credit against the GST we pay as drivers.
This is conceptually correct. Note, however, we will be worse off from a timing perspective as we will need to pay the GST each time we pay the commission but obtain the benefit of the input tax credit up to several months later.
Uber continues to charge us commission on the GST component of our fares, which strikes me as a double dip, unfair and wrong in principle. We can only hope that if Uber does pass on the GST on the commission to us as drivers, it takes the opportunity to remove its commission on the GST component of the fares. But don't hold your breath on that one.
For more information about the recent amendments to the GST law, see https://www.ato.gov.au/General/New-...axes/GST/GST---applying-to-digital-products-and-services-imported-by-consumers/.
