How DoorDash Drivers Are Taxed in Australia

The ATO treats DoorDash drivers as independent contractors, not employees. This means DoorDash does not withhold PAYG tax from your payments, and you do not receive a payslip or an income statement from your employer. Instead, you receive a payment summary or can download your earnings history from the DoorDash app.

As a sole trader, you report your DoorDash income on your annual tax return under "business income" (item 15 on the supplementary section). You pay tax on your net profit — gross earnings minus allowable expenses — at the same marginal rates that apply to salary and wage earners.

You also need to pay the Medicare levy (2% of your taxable income) and, if your income is high enough, the Medicare Levy Surcharge. If you earn above the HECS-HELP repayment threshold of $67,000 (FY 2025-26), compulsory repayments also apply.

Do You Need an ABN and GST Registration?

Yes — you must have an Australian Business Number (ABN) to work as a DoorDash driver. DoorDash requires your ABN before you can start delivering. You can apply for an ABN online through the Australian Business Register, and it is free.

GST registration is required if your annual business turnover is $75,000 or more. When you register for GST, you must charge 10% GST on all your delivery fees. You can also claim back the GST on business expenses such as fuel, car maintenance, and phone bills through your Business Activity Statement (BAS).

If your turnover is below $75,000, GST registration is optional. However, many drivers choose to register voluntarily because it allows them to claim GST credits on vehicle expenses — which is often the largest expense category for delivery drivers.

DoorDash Income, Deductions, and Estimated Tax

Assumes FY 2025-26 rates. Vehicle expenses estimated at 30% of gross earnings. Tax calculated using resident rates ($0–$18,200 tax-free, 16% up to $45,000, 30% up to $135,000) plus 2% Medicare levy. Does not include GST obligations — if registered for GST, an additional ~7–9% of gross earnings should be set aside for GST.

Vehicle and Other Deductions

Vehicle expenses are typically the largest deduction for DoorDash drivers. The ATO offers two methods for claiming car expenses: the cents-per-kilometre method (85 cents per kilometre in FY 2025-26, capped at 5,000 business km per car) and the logbook method (claim the actual business-use percentage of all car expenses based on a 12-week logbook).

For most DoorDash drivers, the logbook method yields a higher deduction because actual running costs — fuel, servicing, tyres, registration, insurance, and depreciation — often exceed 85 cents per km when calculated across many delivery kilometres. If you drive more than 5,000 business km per year, the logbook method is almost always better.

Beyond vehicle costs, you can also claim: mobile phone and data plans (business-use portion), insulated food delivery bags, parking and tolls during deliveries, ABN registration fees, accounting software, and public liability insurance. You cannot claim fines or personal travel.

PAYG Instalments and Quarterly Reporting

Once your DoorDash income exceeds a certain level, the ATO will issue a PAYG instalment notice requiring you to pay tax quarterly. This helps you avoid a large tax bill at year-end. The ATO calculates instalments based on your most recent tax return, but you can vary the amount if your income changes significantly.

If you are registered for GST, you must lodge a Business Activity Statement (BAS) quarterly (or annually if your turnover is under $75,000). The BAS reports your GST collected, GST credits claimed, and sometimes PAYG instalments. Late lodgement attracts penalties, so set calendar reminders for 28 October, 28 February, 28 April, and 28 July.

Using a separate bank account for your DoorDash income makes quarterly reporting much easier. Transfer your tax and GST money into this account after each pay period so you are not caught short when BAS and tax bills are due.

Comparing DoorDash Income to Regular Employment

DoorDash offers flexibility but comes with higher tax complexity than regular employment. As an employee, your employer withholds tax, pays superannuation guarantee contributions (12% in FY 2025-26), and covers workers' compensation insurance. As a DoorDash driver, you are responsible for all of these yourself.

To get a fair comparison, subtract not only your tax but also your super contributions and insurance costs from your gross DoorDash earnings. Most drivers need to earn 20–30% more as a gig worker to match the after-tax and after-super position of an equivalent employee role.

Use the take-home pay calculator to see what an employee with equivalent gross earnings would receive after tax, then compare it to your DoorDash net profit minus your voluntary super contributions. This gives you a realistic view of whether gig work makes financial sense for your situation.

Record Keeping for DoorDash Drivers

The ATO expects you to keep records of all income and expenses for at least 5 years. For vehicle deductions claimed under the logbook method, you need a logbook covering a continuous 12-week period that is representative of your travel pattern. The logbook is valid for 5 years, after which you must create a new one.

For the cents-per-kilometre method, you only need to record the total business kilometres driven. The ATO may ask for evidence, so keeping a trip diary or using a mileage-tracking app is strongly recommended. Apps like QuickBooks Self-Employed, Stessa, or a simple spreadsheet can track every delivery trip.

Keep all receipts for vehicle expenses, phone bills, equipment purchases, and anything else you claim. Digital copies are acceptable. The ATO uses sophisticated data matching, and discrepancies between your reported income and DoorDash's payment data will trigger a review.

Frequently Asked Questions

Do I need to pay GST on DoorDash deliveries?

Only if your annual turnover exceeds $75,000. If you register for GST, you charge 10% GST on all deliveries and claim GST credits on your business expenses. Most full-time DoorDash drivers exceed the threshold and should register. Part-time drivers doing a few hours per week often stay below the limit.

Can I claim the 85c per km rate for DoorDash deliveries?

Yes — the ATO's cents-per-kilometre rate (85 cents per km in FY 2025-26) covers all vehicle running costs including fuel, servicing, and depreciation. The rate is capped at 5,000 business kilometres per car per year, so if you drive more than that, use the logbook method to claim actual expenses.

Does DoorDash report my income to the ATO?

Yes, DoorDash reports payment data to the ATO. The ATO uses this data to cross-check your tax return. Underreporting your DoorDash income is easily detected, and the ATO can impose penalties of 50–75% of the tax shortfall for intentional disregard of the law.

What happens if I don't have an ABN for DoorDash?

Without an ABN, DoorDash is required to withhold 47% (the top marginal rate plus Medicare levy) from your payments and remit it to the ATO under the no-ABN withholding rules. You cannot operate as a DoorDash driver without an ABN — you need one to even start.

Can DoorDash drivers claim lunch and coffee as deductions?

No — the ATO does not allow deductions for food and drink consumed during your shift. Even if you buy a meal while waiting for delivery orders, it is considered a private expense. The only exception is overtime meal allowances under specific award conditions, which do not apply to independent contractors.