T2125 for Uber & Uber Eats Drivers: Complete Canadian Tax Guide (2026)

If you drive for Uber or deliver for Uber Eats in Canada, the CRA considers you self-employed — you're a sole proprietor running a business. That means you must file a T2125 (Statement of Business or Professional Activities) with your T1 personal tax return every year.

Here's the problem: many drivers overpay taxes because they don't know what they can deduct. Others underpay because they don't track properly and get caught in a CRA audit. Either way, it costs you money.

This guide covers exactly what you can deduct on your T2125, how to track mileage to satisfy the CRA, GST/HST obligations for rideshare vs. delivery drivers, and how to avoid the most common audit triggers.

Everything here applies to both Uber rideshare and Uber Eats delivery, with the differences called out where they matter — especially for GST/HST.

Key Facts for Uber / Uber Eats Drivers

What Expenses Can Uber / Uber Eats Drivers Deduct?

The good news is that most costs of running your rideshare or delivery business are deductible. The key is tracking them properly and keeping receipts.

Vehicle Expenses (Usually the Biggest Deduction)

There are two methods for claiming vehicle expenses on your T2125:

1. Actual expenses method

Track every vehicle-related cost: gas, insurance, maintenance, repairs, car washes, parking, lease payments or Capital Cost Allowance (CCA / depreciation). Then multiply the total by your business-use percentage (business km ÷ total km for the year).

CCA for passenger vehicles is claimed at a 30% declining balance rate (Class 10 or 10.1). There are CRA maximums on lease payments and loan interest you can claim.

2. Simplified method (per-km rate)

Use the CRA kilometric rate: 73¢/km for the first 5,000 km and 67¢/km after (2026 rates). Multiply by your total business kilometres.

Phone & Data Plan

Your phone is essential for driving — you need it for the Uber app, navigation, and communication with riders. Deduct the business-use percentage of your total phone and data plan costs. For active drivers, this is typically 50–80%.

Keep your phone bill as documentation. You don't need to calculate exact minutes — a reasonable estimate of business-use percentage is acceptable.

Uber Fees & Commissions

Uber's service fee (typically 25–30% of each fare) is fully deductible as a commission expense on your T2125. These fees are documented in your Uber annual tax summary, which you can download from your Uber driver dashboard.

Booking fees, airport surcharges, and any other platform fees Uber deducts from your earnings are also deductible.

Delivery Supplies (Uber Eats)

If you deliver for Uber Eats, you can deduct:

• Insulated delivery bags and hot bags
• Drink holders and cup carriers
• Phone mounts and car chargers
• Any other supplies used specifically for deliveries

Other Deductible Expenses

• Roadside assistance / CAA membership (business-use percentage)
• Parking (while waiting for rides, at airports — not personal parking)
• Tolls (407 ETR in Ontario, bridge tolls, etc.)
• Car washes (business-use percentage — keeping your car clean is part of the job)
• Safety equipment (dashcam, first aid kit)
• Accounting and tax preparation fees
• Bottled water, mints, phone chargers provided for passengers

What You Cannot Deduct

• Traffic tickets or fines — never deductible, regardless of circumstances
• Personal use of vehicle — only the business-use portion is deductible
• Clothing — unless it's a uniform required by the platform (which Uber doesn't have)
• Commute to your "starting spot" — driving from home to the area where you start accepting rides is generally considered personal use

How to Track Mileage (CRA Requirements)

The CRA requires a vehicle logbook. Here's exactly what must be recorded:

For each business trip:

• Date of the trip
• Destination (where you drove)
• Business purpose (pickup, delivery, etc.)
• Kilometres driven

For the year:

• Odometer reading at the start of the fiscal year (January 1)
• Odometer reading at the end of the fiscal year (December 31)
• Total kilometres driven (business + personal)
• Business-use percentage calculation

The 90-day logbook shortcut: If you've kept a detailed logbook for a full 12-month base year, you may be able to track only a 3-month sample period in subsequent years. If your business-use percentage in the 3-month sample is within 10 percentage points of the same period in your base year, the CRA may accept the base-year percentage for the full year. This is still a valid method in 2026.

The easiest approach: use a mileage tracking app that integrates with Google Maps to auto-calculate distances. ExpenseBot imports trips and calculates distances automatically — meeting all CRA documentation requirements. Digital records (including Google Sheets) are accepted by the CRA.

GST/HST for Rideshare Drivers

This is where it gets tricky — and where many drivers make costly mistakes. The rules are different for rideshare vs. delivery:

How GST/HST works in practice:

• Uber collects and remits GST/HST on rideshare fares on your behalf — you don't need to add it to each fare manually
• You can claim Input Tax Credits (ITCs) on your business expenses — the GST/HST you paid on gas, phone bills, car repairs, etc. can be claimed back
• Filing frequency depends on your revenue: annual, quarterly, or monthly
• The Quick Method is available for small businesses with revenue under $400,000 — it simplifies the calculation by applying a flat rate to your revenue instead of tracking ITCs on every expense

This is one of the most important reasons to track expenses properly — every GST/HST dollar on a business expense is money you can claim back as an ITC. See our Canadian tax deadlines guide for GST/HST filing dates.

How to Fill Out Your T2125 (Step by Step)

The T2125 form has several sections. Here are the key parts for rideshare and delivery drivers:

Part 1: Identification

• Business name: your legal name (or a registered business name if you have one)
• Industry code: 485310 — Taxi and Ridesharing Service
• Main product or service: "Rideshare transportation" or "Food delivery"

Part 2: Business Income

• Use your Uber annual tax summary for total gross income
• Report the full amount before Uber's fees — you'll deduct those separately as expenses
• Include tips (they're taxable income)

Part 4: Net Income Calculation

• This is where all your deductible expenses are listed by category
• Motor vehicle expenses (line 9281) — usually the biggest category
• Office supplies, phone, Uber commissions, delivery supplies, etc.

Part 5: Motor Vehicle Expenses

• Total km driven in the year (business + personal)
• Business km driven
• Business-use percentage
• Each vehicle expense category × business-use percentage

Part 6: Business-Use-of-Home

• If you use a room for administrative work (logging trips, managing the Uber app, accounting), you may be able to claim a home office deduction
• Calculate the percentage of your home used for business (sq ft of office ÷ total sq ft)
• Apply that percentage to rent/mortgage interest, property tax, utilities, insurance

ExpenseBot auto-categorizes every expense to the correct T2125 line item, so you can hand the year-end report directly to your accountant or use it to file yourself.

Avoiding a CRA Audit

Rideshare drivers are audited more often than most self-employed Canadians. Here are the top triggers — and how to avoid them:

1. No mileage log — The #1 trigger. Without a log, the CRA can deny your entire vehicle deduction. Keep a logbook all year, not just for a few weeks.
2. Claiming 100% business use on a personal vehicle — Unless you have a separate vehicle exclusively for rideshare, the CRA won't believe 100% business use. A realistic business-use percentage for full-time drivers is typically 60–80%.
3. Expenses wildly disproportionate to income — If you earned $20,000 but claimed $18,000 in expenses, expect scrutiny. Your deductions should be reasonable relative to your income.
4. Not reporting all income — The CRA receives income data directly from Uber. Starting in 2025, platforms are required to report gig worker earnings to the CRA by January 31 each year. Don't try to underreport.
5. Not registering for GST/HST when required — If you do rideshare, you must register regardless of income. The CRA can (and does) check.