Top 5 Uber Tax Deductions to Claim in 2025 (Canada)

Being an Uber rideshare driver in Canada offers fantastic flexibility, but tax season can be daunting. As an independent contractor, you're responsible for your taxes, and understanding eligible deductions is key to maximizing your earnings.

This blog post highlights the top 5 tax deductions Canadian Uber drivers should claim in 2025 to minimize their tax burden.

Understanding the Basics

Before we dive into deductions, remember you can only deduct the percentage of an expense directly related to your Uber driving activities. Meticulous record-keeping is essential to prove these business expenses to the Canada Revenue Agency (CRA).

Top 5 Tax Deductions for Uber Drivers

1. Vehicle Expenses:

This is often the most significant deduction. You can deduct a portion of your vehicle expenses based on the percentage of kilometers driven for business. Eligible expenses include:

• Gas: Keep all your gas receipts!
• Maintenance and Repairs: Oil changes, tire replacements, brake repairs, etc.
• Depreciation (Capital Cost Allowance - CCA): You can claim depreciation on your vehicle. This is a complex calculation, so consult a tax professional for guidance.
• Licenses and Registration Fees: The business portion of your vehicle license and registration.

2. Cell Phone Expenses:

Your smartphone is essential! Deduct a reasonable portion of your cell phone bill, including data, based on business use.

3. Supplies for Passengers:

These small extras enhance the rider experience and are deductible! Think:

• Water bottles
• Hand sanitizer
• Tissues

4. Cleaning Supplies:

Keeping your car clean is a must. Deduct the cost of car washes, cleaning products, and other supplies used for your Uber vehicle.

5. Input Tax Credits (ITCs):

As an Uber driver, you are required to register for GST/HST from your very first ride. You'll collect GST/HST from passengers and remit it to the CRA. However, you can also claim Input Tax Credits (ITCs) for the GST/HST you paid on eligible business expenses. This can significantly offset the amount you owe.

Important Reminders for Uber Drivers

• Keep ALL Receipts: Digital or paper, keep records of every business-related expense.
• GST/HST registration: Remember, you're required to register for GST/HST from your first ride.

Final Thoughts

Being organized and understanding these deductions can significantly impact your tax bill. Don't leave money on the table! Consult with a tax professional specializing in ride-sharing drivers for personalized advice. They can help you maximize your deductions and ensure you're complying with all CRA regulations.

If you're looking for expert assistance with your Uber taxes, consider reaching out to Instaccountant, your trusted Uber tax accountants in Canada.

#RideshareTaxes #UberDriver #TaxDeductions