If you become an Uber driver it gives you the opportunity to work at their own time and pace. In this article, we will tell you the basic things you need to know to get started as an Uber driver, how much you’ll make, the tax you’re obligated to pay when you become an Uber driver, and your employment rights.
Recently in the United Kingdom, Uber has provided an opportunity for car owners to make extra cash in their own spare time. Uber was granted a short license to operate in London for a probation period of 15 months, and this is an opportunity that any car owner who has spare time can consider taking up.
Although to become an Uber driver is a profitable business to venture into, there is some basic knowledge you need before you get started. Some questions you need to ask:
- What is the process to register to be an Uber driver?
- How much am I likely to make?
- How much of my income is taxable?
- Do I need a license?
How you can become an Uber driver
People working as Uber drivers are regarded as freelancers. They are treated as self-employed people, so they’re called Uber partners instead of drivers. However, recently, a case judged by an employment tribunal in the UK ruled that considering the modalities of the job, the 40,000 Uber drivers all over the United Kingdom do not qualify to be called self-employed; hence they should be entitled to an annual leave, sick pay, National Living Wage and other employment benefits.
The tribunal ruled that it is ridiculous to regard Uber drivers as small business owners connected through a single platform (as Uber choose to call them), since they can only accept or reject jobs strictly on terms and conditions stated by Uber.
Although Uber has appealed against this ruling, the decision still promises to bring a huge change to the gig economy, as it’ll also affect bike couriers and other similar workers.
To state the obvious, the first thing you need to become an Uber driver is a car. The car must be less than 5 years old and must be in good condition. They’re typically saloon or MVP cars that can accommodate 4 to 8 passengers, or something like a Mercedes E-class that can carry up to four passengers. You can check Uber website to see some of the recommended vehicles.
The License you need to become an Uber driver
The first license you need to become an Uber driver is a Private Hire Vehicle license (PHV). You can get this from your local council at a cost which varies from council to council.
One driver left his lecturing job to become an Uber driver in November 2015 when his mother became sick, as he needed a flexible job that’ll give him time to take care of his ailing mother.
He went for his private hire license, which included an interview, Disclosure and Barring Service check (formerly known as Criminal Records Bureau check) and some medical tests for which he paid £95.
According to him, it took him six weeks to complete this process. During this period, the council checked the roadworthiness of the car before giving him the license. The initial tests cost him £240, and he still had to pay £80 every six months for repeat ‘MOT’ style tests.
Another driver chose to get her private hire license through a company that promised to fast track the process. She paid £450, but it still took months before she got the license. She regrets this decision, as she now knows that she could have spent much less to get the license herself.
Business type insurance is always more expensive than insurance on personally used properties. On driver that we spoke to started up paying £180 per year for his Mercedes ‘E class’ but although he kept looking for cheaper alternatives, the insurance cost still increased to £2,700 per year.
This however covers the liabilities that may arise from carrying passengers, and even if you’re the most experienced driver in the country, nothing can bring this price down. Also, you can’t even transfer the ‘no claims’ bonus to use for other purposes, so you still have to start all over again.
Your rights as an Uber driver (or gig worker in general)
As earlier stated in this article, Uber and the gig economy in general, has been criticised for their poor workers’ rights. The attention of the government has been drawn to this, and they promised to review the employment benefits of gig workers to include giving them:
- The chance to demand more stable contracts
- Entitlement to sick pay, annual leaves, etc.
- Right to demand a paycheck
Yielding to this pressure, Uber has in May 2018 announced to offer additional protection to their drivers, to give them limited insurance against injury and sickness, and to give both maternity and paternity payments.
According to the announcement, this policy was set to kick-start by June 2018, and would only be available to drivers that have completed at least 150 trips within the last two months. Hence, this might not benefit people who only do Uber driving jobs on part-time basis.
They fixed sick pay at a maximum of £1,125 per week, and maternity payment at £1000.
Although these benefits still look ridiculous when compared to the benefits of other fulltime jobs, we’ll still have to agree that it is a sign of better days ahead.
To become an Uber driver, you have to apply by filling an application form on their website or on their Facebook page. After filling the forms, both the individuals in our previous examples had to undergo a two-hour training course before they could hit the road.
According to one lady, the training covered mostly basic things such as what to do when a passenger sleeps during a trip, or when you have to physically move a passenger. Both our drivers claimed that immediately after the training, they had customers already waiting for them.
How much can you make an Uber driver?
According to Uber, an average driver makes around £565 from working for 35 to 45 hours weekly, after they deduct their 20% service fee or 25% (as applies to drivers who signed up after April 24th 2016).
According to Stephen, he makes £700 from working for 35 to 45 hours weekly, excluding weekends. Although some drivers complain about spending too much time waiting for fares, Stephen claims he never waits for over ten minutes.
One lady who quit her job with the fire service to become an Uber driver, expressed her joy at the flexibility of the job, and the fact that there are no minimum hours. She claims she does between 1 to 60 hours per week, and rakes in a pay of £1,100 weekly after paying for petrol and deducting Uber commission.
Uber charges a percentage from the fares made by drivers on a weekly basis. After taking their cut, the rest of the money is paid into the drivers bank accounts with a detailed invoice of all the trips made that week.
You can use your phone for communication or download a GPS app, but this isn’t always strait forward, so you can opt to pay £5 weekly to get a company phone with an in-built satellite navigator.
Although it pays moderately well, the income potential is limited by the hours that can be physically worked in a week, therefore making it a steady source of income that will never produce millions.
We rate this as a sound steady income if you like driving, but if you don’t like traffic jams, it’s probably not for you!
Thank you for reading our article on how to become an Uber driver. Read about how to make a second income from matched betting.
High & Wise