NSW Court of Appeal decision concludes Uber liable for NSW payroll tax on payments to drivers.

In a unanimous decision on 1 August 2025, the NSW Court of Appeal in Chief Commissioner of State Revenue v Uber Australia Pty Ltd [2025] NSWCA 172, found Uber Australia Pty Ltd (Uber) liable for $81 million in payroll tax on payments made to its drivers.

This decision overturns an earlier decision of the Supreme Court and has far reaching implications for contractors and businesses across various industries including medical and dental practices.

Uber argued that drivers do not provide services to Uber and therefore the payroll tax legislation should not apply. Uber collects payments from rideshare passengers as an agent for Uber drivers, not as an employer. For example, on a $100 Uber trip, Uber deducts its fee plus GST of about $33 and then passes on the net amount of $67 to the drivers.

However, the five judges of the Court of Appeal unanimously found that:

• Uber’s drivers performed driving services to Uber which were services performed ‘for or in relation to the performance of work’ under the contractor provisions of the Payroll Tax Act 2007 (NSW) (Act). As a result, Uber was employing its drivers under ‘relevant contracts’; and
• Amounts paid by Uber to its drivers were deemed to be wages undersection 35 of the Act and no exemptions applied.

If Uber decides to appeal, it must apply to the High Court for special leave within 28 days of the Court of Appeal’s judgement.

The Uber appeal decision makes it clear that the relevant contractor arrangements remain a focus in NSW. Under the Act, NSW Revenue can review, audit and issue an assessment determining payroll tax is payable for the last 5 years.

What should you do now?

If you’re a practice owner here are some things you should consider doing to assist with obtaining further clarity for your situation:

• Understand your exposure: Check your arrangements with medical and dental practitioners.
• Review your arrangements: Ensure your banking, documentation, practice operations and agreements are aligned.
• Focus on your cashflow and efficiencies: Don’t lose sight of your practice’s operations.
• Seek professional advice: It’s important to understand your circumstances and risk.
  
  

If you have any questions regarding the Uber decision and how this may impact you and your practice speak with our team today.