Written by Andrei Zakhareuski. With over 16 years of expertise, Andrei leads Driving-Tests.org, a top online resource for driver education. His leadership has established vital partnerships with over 2,600 libraries, educational bodies, and state agencies.

Uber, a major player in the ride-hailing industry, connects millions of riders with drivers through a smartphone app. With over 40 million active monthly riders, Uber has become a genuine alternative to traditional taxi services (leading thousands of taxi drivers around the world to engage in a great deal of activism to try to stop it). With a growing user base and expanding global reach, driving for Uber offers an opportunity for individuals to earn income with flexibility. This guide outlines the essentials for becoming an Uber driver.

Uber Driver Requirements: Key Information for Aspiring Uber Drivers

Overview

7 Steps to Becoming an Uber Driver

1

Check Eligibility

Ensure you meet the basic requirements: 21+ years old, at least one year of driving experience (three if under 23), a valid driver’s license, and the ability to pass a background check.

  • You must be 21 years of age or older.
  • You must have at least one year of driving experience (three years if you’re under 23).
  • You must have a valid driver’s license.
  • You must have valid auto insurance that meets certain liability requirements.
  • You must be able to provide proof of insurance and car registration.
  • You must have a car that meets Uber requirements.
  • You must meet all the other state, local, or Uber requirements, which can be found on the Uber website.
  • You can pass a background and criminal check.
2

Select Your Service Type

Decide which Uber service you want to offer: UberX, UberXL, UberSELECT, UberBLACK, or UberSUV. Each has specific vehicle requirements, so choose one that aligns with your current or potential vehicle.

3

Prepare Your Vehicle

Make sure your vehicle meets Uber’s standards for your chosen service type. This could involve maintenance checks, upgrades, or even acquiring a new vehicle.

4

Get the Right Insurance

Obtain appropriate auto insurance coverage. While Uber provides some insurance, it’s crucial to have your own policy that covers commercial driving activities. Your personal auto insurance policy may not cover you while you are working commercially as an Uber driver, so make sure you have proper coverage. Uber has liability insurance to cover you while you are working as an Uber driver, but it may not be enough coverage. Uber offers $1 million in liability coverage for picking up a rider or driving one. However, for the times during which you’re waiting for a passenger to request you, their liability coverage is just $100,000 per accident and they offer no collision coverage. (If you’re involved in an accident in which you are found at fault, your medical liability can easily top $100,000 plus collision damage.) Check with your insurer about how much additional coverage you need. Recognizing the growing popularity of ridesharing through Uber and other companies, some auto insurers now offer rideshare insurance that you can add to your existing personal auto insurance policy for an additional premium.

5

Complete the Signup Process

Download the Uber Driver app, create an account, and submit the necessary documentation, including your driver’s license, insurance papers, and any other required documents.

6

Pass the Vehicle Inspection

Have your vehicle inspected to ensure it meets safety and operational standards. This may be required annually or biannually, depending on local regulations.

7

Start Driving

Once approved, go online in the Uber app to start accepting ride requests. Manage your schedule and ride preferences to optimize your earnings.

Understanding Uber Vehicle Options

There are five common types of Uber services, each based on a particular style of vehicle: UberX, UberXL, UberSELECT, UberBLACK, and UberSUV. You need to decide which type of service you want to provide. Typically, the higher-end Uber services charge the highest rates. Let’s look at the general requirements for vehicles for each type of Uber service. (Note: Uber’s actual vehicle requirements vary from one city to another. Check with Uber for the specific vehicle requirements for your city.)

1. UberX is the lowest-cost Uber ride, so its vehicle requirements are the simplest to meet. To qualify for UberX, your vehicle must be a 2002 or newer four-door sedan in good condition that can seat at least four passengers plus yourself as the driver. (For example, a Chevrolet Cobalt can qualify.)

2. UberXL is also relatively low-cost but provides passengers with more room than they would get with UberX. To qualify for UberXL, your vehicle must be a 2002 or newer SUV or minivan with no cosmetic damage that can seat at least six passengers plus the driver. (For example, a Ford Explorer can qualify.)

3. UberSELECT (known in some cities as UberPlus) is a more expensive option for upscale rides. For UberSELECT, your vehicle must be a 2009 or newer entry-level luxury car with a leather interior and no cosmetic damage that can seat at least four passengers plus the driver. (For example, an Acura can qualify.)

4. UberBLACK is the luxury alternative to UberX. For UberBLACK, your vehicle must be a 2012 or newer luxury car in excellent condition with a black (of course) interior and exterior. (For example, a BMW 5-series sedan can qualify.)

5. UberSUV is the luxury alternative to UberXL. For UberSUV, your vehicle must be a 2012 or newer luxury SUV in excellent condition with a black interior and exterior that can seat six passengers plus the driver. (For example, a Lincoln Navigator can qualify.)

Finally, some cities also offer UberLUX driving. This is Uber’s ultimate luxury ride, which requires a 2012 or newer top-of-the-line vehicle in excellent condition. (For example, a Tesla Model S can qualify.)

How Much Can You Earn as an Uber Driver?

Overview

  • The average Uber driver earns $15.60 per hour.
    • This depends on driving during peak hours.
    • It also depends on the city (the more you know, the higher your pay).
    • The average San Diego driver earns 12.60perhour;theaverageNewYorkCitydriverearns12.60 per hour; the average New York City driver earns 29.34.
    • Learn about possible expenses before you start driving.
    • Expenses can amount to 20–30% of your earnings, so keep track of them!
    • You are responsible for paying income taxes and the self-employment tax.
    • However, most expenses should be tax-deductible.

Maximizing Your Earnings

How much you can earn as an Uber driver largely depends on the city in which you work and the hours during which you work. It’s usually recommended that you work during as many peak hours as possible.

To begin with, Uber takes a 25% commission on every fare that you pick up. Your earnings come from the remainder. A study of 1,150 Uber and Lyft drivers found that the average Uber driver earns $15.60 per hour before expenses.

There are online calculators that can help you estimate your earnings depending on the state you live in (Hudlr)

Maintenance and fuel expenses can amount to 20–30% of your income. Internal Uber figures have shown that when these expenses were subtracted from their pay, drivers in Detroit earned only $8.77 per hour, those in Houston earned $10.75, and those in Denver earned $13.17. This means that starting in 2018, drivers in Detroit earned less than the Michigan minimum wage. However, the median Uber driver earns less than the average Uber driver does. This means that there must be many Uber drivers who are earning a decent living to make the average so much higher than the median.

Still, these figures represent net income before taxes. As a self-employed contractor, you’ll also be responsible for paying your own income tax at all levels: federal, state (if any), and local (if any). An Uber driver earning about $25,000 this year will fall into the 15% federal income tax bracket.

You’ll also be responsible for paying a self-employment tax to cover Social Security and Medicare taxes. The self-employment tax rate for 2017 is 12.4% for the Social Security tax plus 2.9% for the Medicare tax. As you can see, the total tax burden can be significant.

Keep in mind that you must pay self-employment tax if your yearly earnings from Uber are $400 or more.

Deductions

On the other hand, because you’ll be using your car for business reasons, you’ll be able to deduct many car-related expenses from your income tax:

  • Fuel,
  • car repairs,
  • car washes and auto detailing,
  • auto insurance premiums,
  • interest on your auto loan if any, and
  • depreciation of the car.

You’ll also be entitled to a mileage deduction for every mile driven for business reasons. Every mile, including the mileage you accumulate just by driving to pick up an Uber passenger and driving away after you’ve dropped the passenger off at his or her destination. You’ll also be able to deduct the fraction of your smartphone expenses that involves Uber driving.

You may also have other tax deductions such as the Uber commissions, the cost of any background checks you must pass to become an Uber driver, and even the premiums on your health insurance policies.

Summary

Tips for Uber Driving Success

How to Be a More Successful Uber Driver

Tips for Successful Uber Driving

Summary

  • Manage your earnings and expenses.
  • Stand out positively.
  • Keep up with the latest news in your profession.
  • Consider new pay options (such as guaranteed pay).

So far, we’ve looked at how to become an Uber driver and how to get your first riders. But how can you become truly successful at this job? Let’s see.

1. Manage Your Business

As an independent contractor, you effectively have a business that you must manage. You must track your own working hours, earnings, and expenses – Uber doesn’t do any of that for you.

As explained earlier, you are responsible for paying your own income taxes and self-employment tax, so you must track all your earnings and expenses and compute your tax deductions from your expenses. (This includes keeping track of every Uber-related mile that you drive.) Fortunately, there are useful smartphone apps and PC applications for such purposes. Or you can just create some spreadsheets. There are spreadsheet templates available to track hours worked, earnings, etc.

If you’ve never been an independent contractor before, you may be surprised at how long and complicated your tax return can get. You can’t be earning money as an Uber driver while you’re trying to fill out your tax returns by hand. Instead, consider using good tax-preparation software (such as TurboTax) to speed up the process of filing your tax returns.

You can get a tax-preparation software at any Walmart or online (Mike Mozart)

2. Stand Out from the Crowd

You’re competing with your fellow Uber drivers for passengers, tips, and high ratings. You want to show prospective passengers that you’re the best.

How highly you’ll be rated by your passengers will partly depend on what they’ll think of you personally. Certainly, you’ll need to be friendly, courteous, helpful, and outgoing, someone who can make a stranger feel comfortable in your vehicle.

Also, do something that helps you stand out positively from other Uber drivers. Provide your passengers some extra simple amenities (such as smartphone or tablet chargers, facial tissues, or breath mints) to make them feel more comfortable. Such little touches can mean the difference between receiving a four- or a five- star rating or the difference between a generous tip or no tip. Of course, the purchase of such simple amenities for your customers is tax-deductible too.

Impeccably clean interior, nice odor and your smile will usually help you get better ratings

3. Keep Up with the Times

Uber has made a name for itself as a company that tries to stay at the forefront of technology. To fend off restrictive regulations, legislation, or judicial rulings, Uber also tries to respond to various concerns of the communities in which it operates. As a result, there will often be changes to Uber’s operations that you’ll need to be aware of, especially those that may affect your pay.

For instance, in some cases, you may be eligible for Uber’s hourly guarantee. Uber may guarantee to pay you a particular hourly rate as long as you meet certain qualifications such as how many trips you accept and how many trips you perform per hour. To decide whether guaranteed pay is worth it, you need to do a good job of tracking your earnings without it.

For the longer term, you should familiarize yourself with advances in autonomous (self-driving) vehicles and the extent to which Uber will take advantage of this technology. Uber management has stated their intention to move away from human drivers toward autonomous vehicles, dramatically reducing the cost of a ride. Uber has already performed some preliminary experiments with autonomous vehicles. Here you can see their experiments in Pittsburg:

Becoming a successful Uber driver involves understanding the requirements, selecting the right vehicle option, managing your business effectively, and delivering excellent service. Embrace the opportunity with knowledge and preparedness for a rewarding experience.