Taxation for gig workers in Australia

The gig economy in Australia has continued to grow over the last decade. Between 2014-2015, 4.1 million individuals (32%) were reported to have worked as freelancers in Australia. The same study also found that 79% of those traditionally employed in Australia were interested in working more flexible jobs [1].

Regulation within the nation has also worked to keep gig workers as independent contractors which is a stark contrast to many other countries worldwide. Unlike in the United Kingdom, The Australian Fair Work Commission ruled that Uber drivers are not to be considered employees. While in Victoria, laws were passed that would remove annual taxi licenses and treat gig workers as commercial operators or drivers instead [2]. 

Who is interested in gig work in Australia?

According to numbers on, the male to female interest in gig work distribution is 55% to 45% respectively for those seeking employment in the gig economy. Similar amongst other nations worldwide, those seeking employment between the ages of 24 and 34 remain the majority at 46%, however, in Australia the second majority is within the age group of 18 to 24 at almost 20%.

Those between the ages of 35 to 44 comprise 18% of those looking to participate in the gig economy. While those between the ages of 45 and 54 as well as those between the ages of 55 and 64 comprised 12% and 4% respectively.

Tax Filing

The Australian government thus far has ruled in favor of autonomy for gig workers in turn leaves the workers responsible for filing taxes and without typical benefits such as sick leave as traditional employees.

When freelancing, the Australian Taxation Office (ATO) defines income that is earned from knowledge, expertise, skills or labor as Personal Services Income (PSI) if it contributes to 50% or more of an individual’s earnings. Independent contractors have a separate tax filing process from that of their traditionally employed counterparts.

In order to properly file taxes as an independent contractor or gig worker in Australia, it is important for the individual to obtain an Australian Business Number (ABN). Their ABN is then linked to the individuals Tax File Number (TFN) which is also in turn linked to the individuals bank account.

With trackable statements, it is important that detailed and accurate income is accurately documented when filing taxes in Australia.

The financial year in Australia falls from 1 July to 30 June and taxes must be filed by 31 October [3].

Independent contractors that earn over A$4,000 from freelancing or pay more than A$1,000 in taxes are eligible to arrange quarterly pay-as-you-go (PAYG) payments to the ATO opposed to an annual lump sum. If an individual earns more than A$75,000 from freelancing, they are required to register for Goods and Services Tax (GST) [4].

Independent contractors are also responsible for maintaining lists of their deductibles which include costs that are incurred for business purposes. This can include but is not limited to relevant insurances, phone bills, industry licenses, office spaces and more.


Another deductible is for Australian’s paying into a superannuation or “super”. A super acts as retirement funds that are potentially invested in capital streams such as shares, property, or managed funds and many offer a variety of insurances as well as income protection. Usually supers are paid into through employment contracts thus it is the responsibility of independent contractors to pay into their own supers.

In order to do so and avoid extra taxes, independent contractors should link their supers to their TFN. The process of paying into the fund is decided by the individual whether they would prefer a super that is managed for them or if they would like a self-managed super fund [5].

|1] Frank Chung. Australia’s freelance economy grows to 4.1 million workers, study finds. October 27, 2015. -study-finds/news-story/629dedfaea13340797c68822f4f2a469 (accessed September 7, 2020)

[2] Self-Employed Australia. Understanding the (gig) business model. (accessed September 7, 2020)

[3] Australian Taxation Office a. (accessed September 7, 2020)

[4] Self-Employed Australia. Understanding the (gig) business model. (accessed September 7, 2020)

[5]  Australian Taxation Office b. (accessed September 7, 2020)