Tax Deductions for Gig Workers and Delivery Drivers in Canada

If you drive for Uber, deliver for DoorDash, shop for Instacart, or do any other gig work in Canada, you are running a business in the eyes of the CRA. That means you file as self-employed, you owe tax on your net income, and you need to track your expenses carefully. It also means you get access to a wide range of deductions that can significantly reduce what you owe.

This guide covers the tax rules that apply specifically to gig workers and delivery drivers in Canada.

You Are Self-Employed

This is the most important thing to understand: gig platforms do not employ you. You are an independent contractor operating a sole proprietorship. That has several implications:

• You report your income and expenses on Form T2125 (Statement of Business or Professional Activities), attached to your personal T1 tax return
• No taxes are withheld from your platform earnings -- you are responsible for paying income tax and CPP contributions yourself
• You may need to make quarterly tax instalments if you owe more than $3,000 in net tax for the year
• Your tax filing deadline is June 15, but any balance owing is still due April 30

Platforms like Uber and DoorDash may issue tax summaries or T4A slips for your earnings, but these are information slips, not proof of employment. You report the income on your T2125 regardless of whether you receive a slip.

Deductible Expenses for Gig Workers

Vehicle Expenses (Your Biggest Deduction)

For most gig workers, vehicle costs are the largest deduction. You can claim the business-use percentage of:

Expense	Notes
Gas and fuel	Keep receipts or use credit card statements
Insurance	Your annual premium, prorated by business use
Repairs and maintenance	Oil changes, tires, brake pads, mechanical repairs
Car washes	If the vehicle is used for ride-hailing
Licence and registration	Annual provincial fees
Lease payments	Subject to CRA monthly limits ($1,050/month for 2024 leases)
CCA (depreciation)	If you own the vehicle; Class 10 or 10.1
Parking	Business parking only; not parking at your home

You must keep a logbook. Record the date, destination, purpose, and kilometres for every business trip. At the start and end of the year, note your odometer reading. Your business-use percentage is business kilometres divided by total kilometres.

Ride-hailing drivers: Be aware that your business kilometres include driving to pick up passengers, driving them to their destination, and driving between ride requests while you are logged into the app. Driving from your home to where you start your shift is generally considered commuting unless your home is your principal place of business.

Phone and Data Plan

Your smartphone is essential to gig work. You can deduct the business-use percentage of your monthly phone and data plan. If you use your phone 60% for gig work and 40% for personal use, you deduct 60% of the cost.

Supplies and Equipment

Expense	Deductible?
Insulated delivery bags	Yes, 100% -- used exclusively for business
Phone mount / car charger	Yes, business-use percentage
Safety vest or uniform items	Yes, if required for the platform
Hand sanitizer, wipes, masks	Yes, if used for business
Dash cam	Business-use percentage

Platform and Service Fees

Fees deducted by the platform from your earnings are part of your gross income. You report your gross earnings on the T2125, then deduct the platform fees as a business expense. Do not report only the net amount deposited to your bank account.

Other Common Deductions

• Accounting and tax preparation fees -- Deductible in full
• Bank fees on a business bank account
• Roadside assistance membership (CAA) -- business-use percentage
• Tolls -- 407 ETR or bridge tolls incurred during business driving

GST/HST: The $30,000 Threshold

If your gross gig income exceeds $30,000 in any single calendar quarter or over four consecutive calendar quarters, you are required to register for a GST/HST account and begin collecting and remitting GST/HST.

Key Points for Gig Workers

Ride-hailing drivers (Uber, Lyft): You must register for GST/HST from day one, regardless of your income. This is because ride-hailing services are defined as taxable supplies under the Excise Tax Act, and the platforms require GST/HST registration as a condition of driving.

Delivery drivers (DoorDash, Skip, Instacart): The standard $30,000 threshold applies. You do not need to register until you exceed it, but you may choose to register voluntarily to claim Input Tax Credits (ITCs) on your expenses.

Input Tax Credits

Once registered, you can claim ITCs to recover the GST/HST you paid on business expenses. This includes GST/HST on gas, phone bills, supplies, and vehicle maintenance. ITCs are claimed on your GST/HST return, not on your income tax return.

Example: You spend $200 on gas in a month and your business-use percentage is 70%. The HST on that gas (in Ontario) is roughly $23. Your ITC is 70% of $23, or $16.10.

Platform Tax Slips

Gig platforms handle tax reporting inconsistently. Here is what to expect:

• Uber: Issues a tax summary through their driver portal. May issue a T4A if you earn above a certain threshold.
• DoorDash: Provides an annual earnings summary. May issue a T4A.
• Instacart: Provides an earnings summary.
• Skip The Dishes: May issue a T4A for earnings above $500.

Important: Even if you do not receive a T4A, you must report all your gig income. The CRA can see deposits to your bank account and can cross-reference platform records. Failing to report income is the single biggest risk for gig workers at tax time.

Quarterly Instalments

If your net tax owing (after deductions and credits) exceeds $3,000, the CRA expects you to pay quarterly instalments for the following year. The instalment due dates are:

• March 15
• June 15
• September 15
• December 15

The CRA will send you instalment reminders with suggested amounts. You can also calculate your own based on estimated income. Failing to pay instalments on time results in instalment interest charges.

Common Mistakes Gig Workers Make

1. Not keeping a logbook. The CRA can deny your entire vehicle expense claim without one. Use an app or a simple spreadsheet, but track every business trip.
2. Reporting net income instead of gross. Report the full amount the platform shows before their fees, then deduct the fees as an expense. If you report only the net deposit, you are underreporting income.
3. Forgetting to register for GST/HST. Ride-hailing drivers must register immediately. Delivery drivers must register once they cross $30,000. Failing to register does not exempt you -- the CRA can assess the tax you should have collected.
4. Missing CPP contributions. As a self-employed person, you pay both the employee and employer portions of CPP (combined rate of 11.9% for 2025). This catches many first-time gig workers off guard.
5. Not setting aside money for taxes. With no payroll withholding, you need to save a portion of every payment. A common guideline is to set aside 25-30% of your net income for income tax and CPP.
6. Claiming 100% of vehicle costs. Unless your vehicle is used exclusively for business (no personal driving at all), you must apply a business-use percentage. The CRA will challenge a 100% claim.

What Good Records Look Like

For each tax year, you should have:

• A vehicle logbook with trip dates, destinations, purposes, and kilometres
• Receipts or digital records for gas, maintenance, phone bills, and supplies
• Your platform earnings summary showing gross income
• GST/HST returns filed on time (if registered)
• Bank statements showing business income deposits

Keep these records for six years from the end of the tax year. If you filed late, keep them for six years from the date you filed.

Sources

1. CRA: Guide T4002 -- Self-employed Business, Professional, Commission, Farming, and Fishing Income
2. CRA: Business expenses for sole proprietorships and partnerships
3. CRA: GST/HST registration -- When you need to register
4. CRA: Paying your income tax by instalments
5. Excise Tax Act -- Ride-sharing and GST/HST requirements
6. CRA: Motor vehicle expenses -- Business use of a vehicle