The Gig Driver's Complete Money Guide
🚗 You run your own small business
If you drive or deliver for a platform like Uber, Ola, DiDi, Uber Eats or DoorDash, you are almost always an independent contractor, not an employee. That single fact shapes everything about your money. No tax is taken out for you at the door, so your fares and delivery fees are self-employment income that you declare yourself in an IR3 individual income tax return and pay income tax on at the normal rates. On top of income tax there is GST, which since 1 April 2024 the marketplace collects for you on "listed services", your ACC levies, which you pay through an annual invoice rather than through your pay, and provisional tax once your bill gets large enough. It sounds like a lot, but it comes down to a simple habit: treat part of every payment as tax that is not really yours, set it aside, and keep clean records of your income and your costs. This guide takes you through income tax and provisional tax, how GST on listed services and the flat-rate credit work, the expenses you can claim including the kilometre-rate method, and how ACC fits in, all using the 2026/27 New Zealand rules.
Contractor, not employee
As an independent contractor you are responsible for your own tax affairs. That means:
- You have an IRD number and file an IR3 return each year that includes your driving income
- You pay your own income tax, rather than having PAYE deducted
- You pay your own ACC levies through an annual invoice from ACC
- You may need to register for GST, and you may have to pay provisional tax
- You can claim the business costs of earning that income against it
Because you are a contractor, employee protections like the minimum wage, sick leave, and holiday pay do not apply to your platform driving. The trade-off is that you control your hours, and you can deduct genuine business expenses to reduce the income you are taxed on.
Keep your business money separate
The single most useful habit is to open a separate bank account for your driving. Have your platform payments go in there, move a set percentage aside for tax and ACC as soon as you are paid, and pay your fuel and running costs from the same account so your records are tidy. When tax time comes, the numbers are already in one place.
A common trap is spending everything the platform pays you, then facing an income tax and ACC bill months later with nothing set aside. A rough rule for many part-time drivers is to hold back somewhere around a quarter to a third of net earnings, but your own figure depends on your total income for the year.
📊 Income tax, provisional tax and ACC
Your driving profit, which is your income after your business expenses, is added to any other income you have and taxed at the normal individual rates.
Income tax rates for 2026/27
These rates apply for the tax year from 1 April 2026 to 31 March 2027. You pay each rate only on the slice of income that falls in its band.
| Income range | Tax rate |
|---|---|
| $0 - $15,600 | 10.5% |
| $15,601 - $53,500 | 17.5% |
| $53,501 - $78,100 | 30% |
| $78,101 - $180,000 | 33% |
| $180,001+ | 39% |
If you already have a salary or wage, your driving profit stacks on top of it. That means it is taxed at your top marginal rate, so someone earning $60,000 in a job pays 30% on their driving profit up to $78,100. There is no separate lower rate just because it is a side gig.
Filing your IR3
Each year after 31 March you file an IR3 return that shows your total driving income and the expenses you are claiming against it. Inland Revenue works out your income tax on the profit, credits any tax already paid, and the balance left over is your residual income tax.
Provisional tax
Provisional tax is not an extra tax. It is a way of paying your income tax in instalments during the year, instead of one lump sum at the end. You have to pay provisional tax for the next year if your residual income tax for the year was more than $5,000.
- The trigger: residual income tax of more than $5,000 in a year
- What happens next: you pay the following year's tax in instalments
- Standard instalment dates (31 March balance date): 28 August, 15 January and 7 May
In the year you first cross the $5,000 threshold, you can end up paying the previous year's tax bill and your first provisional instalments close together. This is exactly why setting money aside from day one matters. It smooths out that squeeze.
ACC levies
As a self-employed driver you pay your own ACC levies. Rather than coming out of your pay, they arrive as an annual invoice from ACC, usually after you file your return. Self-employed people on ACC CoverPlus pay three levies:
- Work levy: covers work injuries, and the rate depends on your classification unit (the industry code for your type of driving or delivery work) and your liable income
- Earners' levy: covers non-work injuries, charged at $1.52 per $100 of your liable income for 2026/27 (a rate set excluding GST)
- Working Safer levy: a small levy collected for WorkSafe
ACC levies are charged on your liable income between a minimum and a maximum level, and the rates are set excluding GST.
Employees see the earners' levy taken through PAYE at about 1.75% for 2026/27, because their rate includes GST. As a self-employed person you are invoiced the underlying rate of $1.52 per $100 (set excluding GST) as part of your ACC bill, so use the $1.52 figure for your own planning rather than 1.75%.
🧾 GST on listed services and your expenses
Ride-sharing and food or beverage delivery are "listed services". Since 1 April 2024, the online marketplace you drive for must collect GST on these services, which changes how GST works for you depending on whether you are registered.
If you are NOT registered for GST
The marketplace adds 15% GST to the fare or delivery fee and collects it. Of that 15%, it pays 6.5% to Inland Revenue and passes the other 8.5% back to you as a flat-rate credit. The flat-rate credit recognises the GST built into your business costs, such as fuel and vehicle expenses, even though you are not registered to claim it yourself.
You can choose whether or not to include the flat-rate credit as income in your IR3. Either way, you do not file GST returns while you are not registered.
You must register for GST once turnover passes $60,000
If your turnover from your taxable activity is, or is expected to be, more than $60,000 in any 12-month period, you must register for GST within 21 days. This is a rolling 12 months, not just the tax year. You can also choose to register voluntarily below $60,000.
If you ARE registered for GST
Once you register, you must tell the marketplace. From then on the supplies you make through the marketplace are zero-rated in your GST return, which means you charge GST at 0% on those supplies. You no longer receive the flat-rate credit. In return, you can claim back the GST on your genuine business expenses, such as fuel, vehicle running costs and your phone, through your GST returns.
Zero-rated means the supply is still part of the GST system, but at a 0% rate, so you can still claim the GST on your costs. That is why a registered driver with real vehicle expenses can end up with GST refunds, because there is no output GST on the zero-rated marketplace income to offset the input GST on costs.
Expenses you can claim
You can only claim the business portion of your costs. The big one is your vehicle, and there are two methods. You must pick one and use it consistently.
Method 1: the kilometre-rate method
You keep a logbook of your business kilometres and multiply them by Inland Revenue's kilometre rates. The rates for the 2025-2026 income year are:
| Vehicle type | Tier One (per km) | Tier Two (per km) |
|---|---|---|
| Petrol | $1.20 | $0.37 |
| Diesel | $1.30 | $0.38 |
| Petrol hybrid | $0.90 | $0.24 |
| Electric | $1.22 | $0.23 |
The Tier One rate covers both fixed costs (like insurance and depreciation) and running costs. It applies to the business share of the first 14,000 kilometres your vehicle travels in the year. Above 14,000 kilometres of total travel, the lower Tier Two rate, which covers running costs only, applies to the business share. The 14,000 kilometre threshold counts all your travel, business and private together.
If you use the kilometre-rate method you do not separately claim depreciation or the actual costs of running the car, because the rate already builds them in. Self-employed people using this method do not need to deal with GST on the vehicle either.
Method 2: actual costs with a logbook
Instead of the kilometre rates, you can add up the actual running costs of your vehicle for the year (fuel, servicing, tyres, registration, insurance, and depreciation) and claim the business-use percentage of the total. You work out that percentage from a logbook, typically kept for a representative 90-day period, that records your business versus private travel.
Other costs and private-use apportionment
Beyond the vehicle, your mobile phone and data are commonly part-business, part-private, so you claim only the business share. The same apportionment idea applies to anything used for both work and personal life. If your phone is 60% work, you claim 60% of the cost. Keep a note of how you worked out each percentage.
Both vehicle methods depend on records. The kilometre-rate method needs a record of your business kilometres, and the actual-cost method needs a logbook to set the business-use percentage plus receipts for the costs. Without records, you cannot support a claim if Inland Revenue asks.
🔢 Worked examples
These examples use the 2026/27 income tax rules and the 2025-2026 kilometre rates, with round numbers so the arithmetic is easy to follow. They are illustrations, not tax advice for your own situation.
Situation: Ana drives for Uber part time. Over 12 months the value of her rides is $20,000. She is not registered for GST because she is well under $60,000.
How GST works for her:
Income tax: Ana files an IR3, declares her driving income, and claims her expenses against it. She does not file GST returns while she is unregistered. She can choose whether to include the $1,700 credit as income.
Situation: Sina drives full time and her fares reach $75,000 over 12 months, so she must register for GST. She tells the marketplace she is registered. She has $18,000 of GST-inclusive business costs (fuel, vehicle costs and phone) for the year.
Her GST return:
What changed: Once registered, Sina no longer gets the 8.5% flat-rate credit. Her marketplace income is zero-rated, and she claims the GST on her real costs instead. She still declares her driving profit and pays income tax through her IR3, and she is likely to be in provisional tax at this income level.
Because her marketplace supplies are zero-rated, Sina has no output GST to pay but can still claim the GST on her costs. For a driver with heavy fuel and vehicle bills, that can be worth more than the flat-rate credit, though it also means filing regular GST returns.
Situation: Ravi drives a petrol car and uses the kilometre-rate method. Over the year his car travels 20,000 kilometres in total, and his logbook shows 80% of that travel is for driving work.
Working out his vehicle claim:
How it helps: Ravi subtracts the $15,216 (plus his business phone share) from his driving income before working out his taxable profit. Using the kilometre rates, he does not separately claim fuel, depreciation or servicing, because the rate already includes them.
The switch from Tier One to Tier Two happens once the vehicle passes 14,000 kilometres of total travel for the year, counting both business and private use, not 14,000 business kilometres. Apply the business percentage within each tier.
Situation: In her first full year of full-time driving, Mele's profit after expenses is $48,000. She has no other income and no tax was deducted during the year.
Her income tax and residual income tax:
What it means: Because her residual income tax is more than $5,000, Mele must pay provisional tax for the following year, in instalments (with a 31 March balance date, on 28 August, 15 January and 7 May). On top of income tax she will also get an ACC levy invoice, so setting money aside through the year is what keeps the double hit manageable.
Sources
Rates, dates and rules in this guide were checked in July 2026 against Inland Revenue and ACC guidance:
- Inland Revenue, "GST for drivers, deliverers and accommodation owners" and "GST on fares, delivery fees and expenses" (15% collected from 1 April 2024, 6.5% to Inland Revenue, 8.5% flat-rate credit for unregistered drivers, zero-rating for registered drivers), ird.govt.nz/sharing-economy
- Inland Revenue, GST registration required once turnover is over $60,000 in any 12-month period, register within 21 days, ird.govt.nz/gst/registering-for-gst
- Inland Revenue, "Provisional tax" (payable next year when residual income tax is more than $5,000; standard instalment dates 28 August, 15 January and 7 May for a 31 March balance date), ird.govt.nz/income-tax/provisional-tax
- Inland Revenue, "Kilometre rates 2025-2026" (petrol Tier One $1.20 and Tier Two $0.37; diesel $1.30 and $0.38; petrol hybrid $0.90 and $0.24; electric $1.22 and $0.23; Tier Two applies above 14,000 km of total travel), ird.govt.nz
- Inland Revenue, individual income tax rates for 2026/27 (10.5%, 17.5%, 30%, 33%, 39%), ird.govt.nz
- ACC, "Understanding levies if you work or own a business" and levy results (self-employed pay work, earners' and Working Safer levies on CoverPlus; earners' levy $1.52 per $100 for 2026/27 excluding GST; maximum liable earnings $156,641), acc.co.nz
Note: this guide is general information about New Zealand tax, not tax advice. The flat-rate credit is set at 8.5% and could be reviewed, and ACC work-levy rates depend on your classification, so confirm the current figures for your situation with Inland Revenue and ACC.
Related tools and guides
- Side Hustle Tax Calculator - estimate the tax on your driving income
- Schedular Payments Calculator - for contractors with tax deducted at source
- GST Calculator - add or remove 15% GST from an amount
- Provisional Tax Calculator - work out your instalments
- Mileage Reimbursement Calculator - apply the kilometre rates
- Platform economy GST
- Self-employed tax
- Selling online and tax
- ACC weekly compensation
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