Whether you drive for Uber, Lyft, or any other rideshare platform in Calgary, Edmonton, or anywhere else in Alberta, the CRA considers you a self-employed business owner. That comes with real responsibilities — and some real opportunities to reduce your tax bill if you know what you're doing.
The Self-Employed Reality
Uber does not deduct income tax from your earnings. There's no T4 slip. Every dollar you earn — fares, tips, and bonuses — is taxable income that you must report on Form T2125.
GST Registration: The Day One Rule
Here's the rule that trips up new drivers the most: Rideshare drivers in Alberta must register for a GST account from day one. Unlike most businesses, there is no $30,000 threshold for rideshare services. If you're driving, you need a GST number immediately.
The Silver Lining: Input Tax Credits
Once you're GST-registered, you can claim Input Tax Credits (ITCs) on all business expenses (gas, repairs, etc.), which often significantly reduces the GST you actually remit to the CRA.
What Can You Deduct?
Vehicle expenses are by far the biggest deduction. Your deductible percentage is business km ÷ total km. Deductible vehicle costs include:
Beyond your car, don't miss these other deductions:
- Uber/platform service fees
- Dashcam or equipment
- A portion of your mobile phone and data plan
- Tax preparation fees for your business return
Mileage Logs: Non-Negotiable
Digital is Better
The CRA requires a logbook. Use apps like Driversnote or MileIQ to automate this. If you're audited, a proper log is the difference between keeping your deductions and losing them.
Your Uber Tax Summary vs. CRA
Many drivers think the Uber Tax Summary is their official tax document. It's actually just a reference to help you fill out your T2125. It is not an official tax document and doesn't always reflect all your personal business deductions.
Set Aside for Tax Day
A good rule of thumb is to set aside 25–30% of every paycheque for taxes. Having this money parked in a separate high-interest savings account ensures you have no nasty surprises when April rolls around.
Uber Eats & Skip Drivers
Delivery drivers (without passengers) follow different GST rules. You don't need a GST number until you cross $30,000 in revenue. If you do both rideshare and delivery, you'll likely report them together.