Earlier this week, The Sun reported that Uber drivers may soon have to pay taxes should the Malaysian government fail to impose tax on Uber’s ride revenues. The US-based company has a shrewd tax strategy that has so far escaped the net cast by tax authorities including those in Australia, Canada, Hungary, the UK and US.
The free daily has followed up with a fresh report quoting Uber Malaysia GM Leon Foong saying that drivers are responsible for their own tax affairs. “The taxation differs from driver to driver. Only they know their income from driving and other sources and what is taxable,” Foong told The Sun in an email interview.
Uber’s local arm does not generate income on the basis of fares. “Uber Malaysia is paid for providing marketing and support services to the Malaysian rider and driver community,” he pointed out, confirming that the fares paid via credit/debit card are wired to an Uber subsidiary in the Netherlands.
“Uber in Malaysia does not collect fares from the Malaysian driver community,” he said, adding that between 70% to 80% of the fare collected from a passenger is channelled to the driver on weekly basis.
Asked by the paper if the company will be ready to comply with the possible scenario of Inland Revenue Board (LHDN) taxing income generated from fares collected when the government’s ‘e-hailing’ initiative takes off, Foong said that as a company registered in Malaysia, it will comply with all relevant local tax obligations (remember that fares aren’t channeled to Uber Malaysia, but Uber BV in the Netherlands).
Last June, Land Public Transport Commission (SPAD) chairman Tan Sri Syed Hamid Albar was quoted saying that Uber’s cashless payment system did not benefit the country. “The money goes out of the country and our ringgit does not circulate locally.” Uber has recently started to accept cash for rides.
The move to legalise and regulate app-based ride hailing services such as Uber and Grab is on track. After receiving endorsement from the Special Economic Committee chaired by Prime Minister Datuk Seri Najib Abdul Razak last month, SPAD will table a paper to the Cabinet this month for final approval.
Uber/Grab aside, the “e-hailing” model also includes details to transform the taxi industry, public service vehicle (PSV) license requirement for private car drivers, annual vehicle inspections and comprehensive insurance coverage. More on the planned comprehensive revamp here.
Our take on this is that it’s not unfair for drivers to have their Uber/Grab income taxed. Salaried employees have nowhere to hide from the taxman, and no groups should be given a free ride.
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Those part time Uber driver’s incomes are not “fixed-income” so i don’t think it should be taxed. If they continue with this tax plan i think Uber drivers won’t register at all. Thus everything will be back to square one.
Those part time Uber driver’s incomes are not “fixed-income” so i don’t think it should be taxed. If they continue with this tax plan i think Uber drivers won’t register at all. Thus everything will be back to square one
BN supporters come comments supporters for another “new Taxes system”. Wondering how many more taxes will be implemented in the future?
Nope. If taxed, it shud be under Borang B Self Income
“Our take on this is that it’s not unfair for drivers to have their Uber/Grab income taxed. Salaried employees have nowhere to hide from the taxman, and no groups should be given a free ride. ”
First time I see paultan give own opinion?
Anyway, how naive people think uber income no need declare for tax? Part timers earning rm100, 200 a month maybe tak pe, if caught and penalised also still small amount, but those earn RM7k?
LHDN can know. They are capable. They’re just being merciful and kasi chance now. There is nothing to be proud evading tax and thinking you outsmart LHDN.
As my job deals with them a lot, I warn you all don’t play2 with them. Being honest and upfront is best way to minimise your tax. Else, don’t think you can sleep well at night.
Any doubt, go to LHDN branch and ask any question. They’re happy to give free advice and guidance, in tax and record keeping practice. During off-peak time of month, you can literally sit down and do your whole account with them. Your every single transaction, you can do with them, and know your financial position, your tax amount, etc. They’re paid by your tax, utilize them. They’re not your stereotypical lazy govt servant, give them some job and they’ll help.
Everyone is responsible for their own tax affairs actually. Guess that Uber drivers’ income is considered as business income. So all expenses incurred to generate that income is deductible expense – petrol, road tax, insurance, repairs, permits, tolls, charges payable to Uber, etc. In the end, after deducting everything, may end up paying very little tax. Hehe.
Now I see why gahmen support Uber or Grab.. because gahmen never can’t even tax taxi driver lol
Uber cut fares, cut incentives and soon drivers need to pay for PSV and taxes. all the cost channel to drivers. Rewarding only themselves and riders.
on top of that, still need to pay for petrol and maintenance…. all these drivers better stop driving. no point driving at a lost.
Working in Starbucks or McD pays better than being a Uber driver.
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No one can escape from taxman…
Danny. U must understand that an Uber/Grab driver is essentially an ownself businessperson, using own vehicle as a means to earn income. Its just that these apps are enablers to connect to their customers. Traditionally a self-employed person oso have to declare income tax (whether need to pay or not is immaterial). So why not look at Uber/Grab drivers this way? As a self-employed person?
Of course Uber/Grab wud have to pay their own taxes as well. Corporate tax, that is.
As you mentioned, those who are self-employed have to declare their income and pay taxes if required. It should be the same for Uber/Grab drivers, but since the sector is currently unregulated, it has been a “free ride” for them.
Don’t get me wrong, though. I’m a regular Uber user and I’ve met some very nice and hardworking drivers in my journeys.
Ahh. Much appologies. I did not notice the “not” in ur last statement and taught u r asking Gov to gip Uber/Grab drivers a free ride.
are they suppose to file form B or form BE ? are they considered employed by uber/grab , or self-employed ?
Anyone can evade tax if you deal cash in cash out. Do not deal with numbers in the computer ie bank account, credit, etc.