Photo/Illutration Demand for Uber Eats boomed during the COVID-19 pandemic. This photo was taken in Tokyo in April 2020. (Asahi Shimbun file photo)

The Tokyo Regional Taxation Bureau requested Uber Eats Japan Inc. hand over information on the compensation of its delivery staff to ensure they are properly filing their tax returns, sources said.

The probe into tax-related information of the delivery workers comes amid a swift expansion of the major food-delivery service in Japan in recent years.

As people refrained from eating out due to the COVID-19 pandemic, demand for the service grew rapidly, and the number of delivery staff increased to about 100,000 across the country.

Delivery staff are contractually sole proprietors and must file a tax return in some cases.

But the tax authority believes that some of them are failing to do so and it is trying to get a grip on the situation.

“With this effort, we are trying to correct the unfairness given to sole proprietors who file a tax return,” a tax authority official said.

Uber Eats is available in Tokyo and 35 other prefectures, according to the company. The number of establishments registered through the service has soared from around 150 about five years ago to some 100,000 in May.

The company said it does not directly employ delivery staff, but rather makes a contract with them as sole proprietors.

If working as an Uber delivery person as a side business and their annual income exceeds 200,000 yen ($1,800), they must file a tax return.

The tax authority has requested the names and addresses of the delivery workers, the amount paid to them in 2019 and their bank information, sources said.

Uber Eats Japan explained to the deliverers at the time of making contracts that they will need to file a tax return depending on their income. The company informed them that it will accept the tax authority’s request.

“Generally, in some cases, we provide information to the tax authority and inform delivery staff on such reports,” a company official said.

That compliance has made some deliverers nervous.

A Tokyo tax accounting office received a flood of inquiries and the number of hits to its website suddenly spiked because it featured information about filing tax returns for delivery staff.

“I have not been filing a tax return, but I got scared that this will be found out,” one deliverer said.

A tax accountant said that as more people choose to become sole proprietors, the tax authority “might want to urge them to properly file their taxes.”

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