Tax Guide for Uber, Lyft, and Ride-Share Drivers in Quebec: GST/QST Rules, Income Reporting, and Deductible Vehicle Expenses — CPA Firm Near You, Montreal

Introduction

Ride-share drivers working with Uber, Lyft, Eva, and other transportation platforms in Quebec face unique tax rules that differ from typical freelancers. GST/QST registration is mandatory from the first dollar of ride-share income, vehicle expenses must be tracked meticulously, and platform payouts can be inconsistent. Many drivers lose deductions or face reassessments because they do not understand the specific tax obligations for transportation services. This guide explains how ride-share drivers must report income, claim vehicle expenses, and comply with GST/QST requirements — and how a CPA firm near you in Montreal can help you stay fully compliant.

Legal and Regulatory Framework

Under the Income Tax Act and the Taxation Act of Quebec, all ride-share income must be reported as business income. Unlike most freelancers, ride-share drivers must register for GST and QST immediately — the small-supplier threshold does not apply to commercial passenger transportation. Drivers must collect and remit GST/QST on fares, although platforms like Uber may handle part of the remittance. Deductible expenses include fuel, repairs, insurance, car payments or leasing costs, parking, tolls, cellphone usage, car washes, winter tires, and a percentage of depreciation through capital cost allowance (CCA). CRA and Revenu Québec require detailed mileage logs, receipts, and platform payout statements to support all claims.

Key Court Decisions

Courts have repeatedly ruled that drivers may deduct vehicle expenses only in proportion to business use, based on accurate mileage logs. Several rulings denied deductions because taxpayers lacked logs, mixed personal and business use, or claimed unrealistic mileage. Judges also confirmed that GST/QST registration is mandatory for all drivers from the first dollar earned and that failure to collect and remit sales tax results in significant reassessments. Courts emphasized that platform statements alone are not enough — proper bookkeeping and receipts are essential.

Why CRA and Revenu Québec Target Ride-Share Drivers

Ride-share drivers are frequently audited due to inconsistencies between platform payouts, mileage logs, and declared expenses. Authorities use data provided by Uber, Lyft, and other platforms to cross-check income reporting. Large deductions for fuel, repairs, or leasing without proper documentation immediately trigger red flags. Missing mileage logs, cash payments, and informal expense tracking are leading causes of reassessment. Because GST/QST registration is mandatory from the start, many drivers face backdated tax bills when they do not register early.

Mackisen Strategy

At Mackisen CPA Montreal, we help ride-share drivers build a complete tax-compliance and bookkeeping system. We register drivers for GST/QST, set up proper invoicing workflows, and ensure that platform payouts match declared income. We optimize deductions for fuel, repairs, insurance, depreciation, parking, tolls, and cellphone use based on accurate mileage tracking. Our team prepares year-end filings, manages instalments, and organizes documentation to reduce audit risk. If an audit occurs, we reconstruct mileage records, defend deductions, and negotiate payment structures to reduce penalties.

Real Client Experience

A Montreal Uber driver was audited after declaring high fuel and repair deductions without mileage logs. CRA reconstructed income using platform data and attempted to deny most expenses. We rebuilt mileage records using trip history, validated receipts, and recalculated legitimate deductions. The reassessment was reduced significantly and the driver adopted a proper tracking system moving forward.

Common Questions

Do Uber and Lyft drivers need to register for GST/QST?

Yes. Registration is mandatory from the first dollar of ride-share income.

What vehicle expenses are deductible?

Fuel, repairs, insurance, leasing, depreciation, parking, tolls, car washes, winter tires, and cellphone use may be deductible based on business-use percentage.

Do platforms remit GST/QST on my behalf?

Some platforms remit part of the sales tax, but drivers are still responsible for full compliance and accurate reporting.

How do I calculate business use of my car?

Based on detailed mileage logs comparing total kilometers driven to business kilometers.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses stay compliant while recovering the taxes they’re entitled to. Whether you’re filing your first GST/QST return or optimizing multi-year refunds, our expert team ensures precision, transparency, and protection from audit risk.