How Much Can You Make as a Lyft Driver
How Much Do Lyft Drivers Make?
- What Lyft Is
- Average Annual Earnings
- Hourly Earnings
- Income Taxes
- Factors Affecting Earnings
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The gig economy and advances in technology accept made for interesting job opportunities. Ride-hailing services like Lyft are at present a formidable office of the transportation industry. The rideshare visitor, which is function of the Lyft Inc. portfolio, is 1 of the two most popular taxi-culling services in the U.S.
But how much do Lyft drivers make? Keep reading to observe out.
What Is Lyft?
Lyft is a rideshare platform currently operating in the U.South. and parts of Canada. The platform was established in 2012 and went public through a Nasdaq listing in March 2019.
Lyft operates in over 600 cities in the U.S. and 10 in Canada. More than two one thousand thousand drivers operate on the platform, serving over 12 meg customers. Customers book rides with their smartphones through the Lyft app, which is available via Google Play or the App Store.
What Is the Boilerplate Income for Lyft Drivers?
Estimates vary for how much Lyft drivers earn. Indeed puts the average annual earnings for drivers on the rideshare platform at $24,895 based on 207 self-reported earnings — 49% below the national average for drivers.
Glassdoor estimates the boilerplate earnings for a Lyft driver to be $17 per 60 minutes based on 214 self-reported earnings. Multiply that by 40 so by 52, and that works out to an annual income of $35,360.
Lyft drivers are not salaried employees of Lyft — when you sign up as a driver, yous practice and so as an contained contractor. Like other gig workers, Lyft drivers receive a 1099 statement instead of a W-two and are not subject to minimum wage requirements. You lot drive on your own time, in your own car. You alone handle your vehicle maintenance, gas and nearly insurance costs.
Drivers' earnings are based on the time they spend driving with passengers in their machine and the altitude they bulldoze with passengers. Lyft calculates drivers' pay from the moment a commuter picks upwards a client, beginning one minute after the driver taps "Get in."
The app calculates charges past tallying several costs:
- Base fare
- Fourth dimension charge per unit
- Distance rate
Expert To Know
The cost per trip varies according to what urban center you're driving in. Bonuses and adjustments due to things like higher-than-usual demand likewise determine how much you make at the finish of the day.
Hourly Earnings
Though commuter rates are calculated based on how long they bulldoze with passengers in the auto and the distance they bulldoze with passengers, Lyft takes a 20% cut of the gross fare and pays the rest out to the driver. So, what'south the average daily take-domicile pay after Lyft'southward share?
On a typical day, a driver makes between $12 and $17 per hour, according to Indeed and Glassdoor estimates — that'southward $96 to $136 in viii hours. Driving forty hours per week, you could wait to earn $480 to $680 per calendar week, or $1920 to $$2,720 per month before taxes and non including expenses.
Income Taxes for Lyft Drivers
Keep in mind that no income taxes will exist withheld from your pay when you bulldoze for Lyft as a 1099 worker. Just you owe taxes on the money that Lyft pays y'all. That means you've got to calculate your own income taxes. Y'all are besides on the claw for self-employment tax to the IRS as before long every bit you make over $400 as a 1099 contractor in a calendar yr.
That federal self-employment revenue enhancement charge per unit is 15.three%. This amount covers the usual employee withholding (7.65%) and the amount that a normal employer would contribute (vii.65%) to Medicare and Social Security tax for a W-2 employee. Then Lyft drivers, like other contained contractors, pay 7.65% more in Social Security and Medicare withholding than West-2 employees, plus any federal, country and local tax they owe.
However, Lyft drivers can deduct expenses from their gross income, which reduces their revenue enhancement liability. Write-offs include a standard mileage deduction or bodily expenses involving business use of your machine, tolls and parking, amenities you provide to riders and cell phone expenses directly related to your business.
What Impacts Lyft Earnings?
Several factors bear on how much you'll make as a Lyft driver. Your income can shift depending on how many hours you lot put in, where you lot're based, your expenses and whether y'all go tips from customers.
Here'southward a closer wait at factors that impact your income.
Where You Live
Your location determines how much yous earn. For example, the higher the cost of living is in your metropolis, the more you lot'll make while driving for Lyft. That means if you're plying the roads of Seattle, you lot'll make more than than a driver in Wyoming. Also, city drivers make more those in rural areas.
There's besides client density. Busier places naturally accept more customers. When y'all leave your firm and turn on the app, do y'all immediately receive requests, or exercise y'all take to bulldoze closer to town? If you receive client requests as shortly equally you lot plough on your app, you're poised to earn more than money faster.
Surge Pricing
Surge pricing is a model that capitalizes on loftier demand for ride-sharing. Such high demand could arise from blitz hour and increase fifty-fifty more combined with rainy atmospheric condition. Working during peak hours can dramatically increase your earnings.
Bonuses and Promotions
Lyft has a bonus programme for drivers. The platform schedules promo and bonus periods randomly, allowing hardworking drivers to rake in more than pay. Lyft allows drivers to keep 100% of the bonuses they earn during promotion periods.
Service Tiers
Lyft allows drivers in some cities to offer services in different tiers. This enables them to choose betwixt providing regular service and providing luxury service. A driver with a high-end vehicle, 2014 model or afterward (2016 in Houston, Texas), who maintains a rating of at least 4.85, qualifies to provide luxury service. Lyft's luxury tier is categorized into Lyft Lux, Lux Blackness and Lux Black 40.
Hours Worked
It may seem self-evident, but the number of hours a driver works naturally translates into the amount they earn. Drivers who spend more hours backside the wheel will typically earn more than those who piece of work just a few hours per twenty-four hours.
Is Driving for Lyft Worth It?
Driving for Lyft is flexible compared to a full-time, or even part-time, task. Drivers can piece of work at their convenience as they take care of their business concern, creating time for hobbies and family members or friends.
The cost of running the business concern tin can be expensive. It's non unheard of for expenses to run Lyft drivers out of business. Furthermore, earnings are limited by demand — if there aren't enough customers to continue you lot busy for 40 hours a week, your earnings will exist less than those of a driver in a high-demand area.
A major pro is that drivers control their own schedule, and in large part, their earnings. For many, the flexibility of operating every bit a Lyft commuter outweighs its downsides, which is probably why at least 2 million drivers are using the platform to generate income.
FAQ on Driving for Lyft
Here are the answers to some ordinarily asked questions well-nigh driving for Lyft.
- How can I earn more than with Lyft?
- You tin earn more than by taking advantage of promotions, putting in more hours, and providing excellent services to customers who in turn might tip you lot.
- Does Lyft offer drivers the option to rent a car?
- Lyft'southward platform offers rental cars to drivers who can not beget to buy a car. This is possible thanks to Lyft's partnership deals with Flexdrive and Hertz through the Express Drive plan.
- Does Lyft cover gas and car maintenance expenses?
- Lyft does not cover gas and automobile maintenance expenses. Drivers are contained contractors, and they are expected to take care of these expenditures with the money they earn from trips.
- Does Lyft pay for accidents?
- Yes, Lyft provides insurance for accidents. The platform has third-party liability coverage that pays upward to $1 million for personal injuries and property damage if a driver is involved in an accident. This insurance is contingent on the terms of service at the time an accident happens. Claims get to the driver's insurance company first earlier the platform determines whether it will pay for damages.
- How long does it accept to showtime earning on Lyft?
- Information technology takes around 30 minutes or less to enter your credentials — which are typically your telephone number, email address, commuter's license and other identifying information. If you have a motorcar, Lyft will determine its road readiness. You also have to qualify the platform to run background checks on your driving tape. This procedure usually takes a few days.
Daria Uhlig contributed to the reporting for this article.
Information is accurate as of Oct. 13, 2021, and subject to change.
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