Ethical transport starts with the people doing the work.

Assume a subcontracted delivery driver invoices $2,000 per week, including GST, for 50 weeks of the year.

The $9,091 in GST is not the driver's personal income. The driver must account for GST collected and offset eligible GST credits on business purchases through their business activity statements.

This leaves approximately $90,909 in revenue excluding GST, before operating expenses.

That is the money available to fund the business. It is not the driver's wage, taxable profit or take-home income.

A subcontractor must pay the costs associated with keeping the vehicle operational, even when business is quiet or the driver is not generating revenue.

For this example, the estimated annual costs are:

These estimates demonstrate that the driver must fund approximately $49,000–$50,000 in annual business outlays before personal income tax.

Vehicle and fuel costs alone amount to $41,000 per year.

This is before allowing for any additional accounting fees, phone and internet costs, unexpected mechanical failures, major repairs, parking, unpaid waiting time, additional dead-running kilometres or money set aside to replace the vehicle.

The calculation also assumes that the $500 weekly vehicle cost is paid throughout the year, while fuel is purchased for 50 working weeks.

The driver may be entitled to claim GST credits for eligible business purchases, subject to GST registration, the nature of the purchase, business-use percentages and the required documentation.

For this illustration, GST credits of approximately $4,182–$4,273 are assumed on the vehicle, fuel, tyres, servicing and tolls. The entire $3,000 registration and insurance allowance is conservatively retained as an expense without reducing it for possible GST credits.

The actual GST credits could differ depending on the invoices and the treatment of each expense.

After accounting for these estimated GST credits, the business calculation is:

The driver has therefore generated approximately $45,000–$46,000 in taxable business profit from $100,000 in gross invoices.

This is a fundamentally different financial position from an employee receiving a $100,000 salary.

For the 2026–27 financial year, Australian resident income tax rates include 15% on taxable income between $18,201 and $45,000, and 30% on the portion above $45,000 up to $135,000.

The following calculation assumes the driver is an Australian tax resident operating as a sole trader, has no other taxable income, and is eligible for the Low Income Tax Offset.

This is an estimate based on the current ATO resident income tax rates and Low Income Tax Offset rules.

It excludes any Medicare levy surcharge that might apply, student loan repayments, other income, additional deductions and other personal tax adjustments.

After the estimated operating costs and personal tax, the outcome is approximately:

The driver is left with approximately $40,500–$41,100 per year to support their personal living expenses and financial future.

That is approximately $779–$791 per calendar week when averaged over 52 weeks.

The figure is before any unbudgeted business overheads and does not include a separate amount saved for retirement.

It is also important to understand that this calculation is not a measure of the driver's hourly earnings. The number of hours worked, unpaid waiting time, administration and kilometres travelled without payment would need to be established before an effective hourly income could be calculated.

According to the Australian Bureau of Statistics, average full-time adult ordinary-time earnings were $2,083.70 per week in May 2026.

Annualised over 52 weeks, this is approximately $108,352 before personal income tax and excluding employer superannuation.

Source: ABS — Average Weekly Earnings, May 2026.

This is an average across full-time adult employees, not the median salary or an amount earned by every worker.

For a fair comparison, assume the employee earns $108,352 in annual salary, has no other taxable income, receives no additional deductions or offsets, and pays the standard Medicare levy.

The employee retains approximately $83,159 in take-home wages, with approximately $13,002 in employer superannuation contributed on top of their salary.

The superannuation guarantee rate is 12% from 1 July 2025 and remains 12% for the 2026–27 financial year. See the ATO superannuation guarantee guidance.

The financial gap

The employee has approximately twice as much take-home cash as the subcontractor in this example, before even considering the additional value of paid leave and employment protections.

This comparison is especially significant because the subcontractor has invoiced $100,000, while the employee earns an annual salary of approximately $108,352.

The two headline figures are not equivalent.

The employee's salary is their gross employment income before personal tax. The contractor's $100,000 invoice total includes GST and must also cover the costs of running the business.

The financial gap is not limited to the difference in take-home cash.

Eligible permanent full-time employees generally receive minimum employment entitlements under Australia's National Employment Standards, as well as employer superannuation. These include:

• Paid annual leave: Four weeks of paid annual leave per year. The employee can take this time away from work while continuing to receive their ordinary pay.
• Paid personal and carer's leave: Ten days of paid personal leave per year, subject to the applicable rules and eligibility.
• Public holidays: Eligible employees generally receive a paid day off on a public holiday when it falls on a day they would ordinarily work, subject to the applicable rules.
• Superannuation: Eligible employees receive employer superannuation contributions. In this comparison, that is approximately $13,002 each year on top of wages.
• Other employment protections: Depending on eligibility and circumstances, employees may also receive paid family and domestic violence leave, parental leave entitlements, long service leave, notice of termination and redundancy pay.

The precise entitlements depend on the employment arrangement, applicable legislation, award or enterprise agreement, and eligibility requirements.

An independent subcontractor generally does not receive employee entitlements such as paid annual leave and paid personal leave simply by virtue of being a contractor. They must plan financially for periods when they cannot work or invoice.

For the contractor, taking time off can mean losing revenue while vehicle-related costs continue. Illness can also reduce income at the exact time household expenses continue.

The $100,000 example assumes 50 invoiced weeks and only two weeks without invoiced revenue. It does not provide the same four weeks of paid annual leave that a full-time employee generally receives.

If the subcontractor takes four weeks off and invoices only 48 weeks, gross invoices would fall from $100,000 to $96,000, before considering any reduction in variable expenses. The weekly vehicle cost would still continue under the assumptions used here.

This makes the difference between an employee's paid time off and a contractor's unpaid time away particularly important.

The employee's salary is paid across the year, including periods of eligible paid leave. The contractor must generate sufficient revenue during working periods to fund both their living expenses and periods without income.

Official guidance: Fair Work Ombudsman — National Employment Standards.

An employee receiving employer superannuation has an additional source of retirement savings that is separate from their take-home pay.

The subcontractor, by comparison, has approximately $40,500–$41,100 remaining in this illustration before setting aside personal retirement savings and before accounting for other business costs.

If the contractor wants to build retirement savings at a similar rate to the employee's approximately $13,002 employer contribution, that money must come from their remaining funds unless an applicable superannuation obligation requires someone else to pay it.

That would leave approximately $27,500–$28,100 after making a personal contribution of $13,002, before considering the separate tax treatment of super contributions and any other business or household costs.

This is an illustration of the financial pressure involved, not a recommendation that every subcontractor should contribute exactly that amount.

There is also no guarantee that the driver can maintain the same income every week. Vehicle breakdowns, injury, illness, quiet periods, customer payment delays and changes in fuel costs can all affect the amount available to support the driver and their family.

The long-term financial picture therefore includes more than the annual profit shown on a tax return.

This financial comparison assumes a genuine independent business relationship. It should not be taken to mean that every worker labelled a subcontractor is legally an independent contractor.

Under Australian law, the real circumstances of the working relationship matter. Having an ABN, issuing invoices or signing a contract describing someone as a contractor does not automatically settle the question.

The tax, superannuation and workplace-law tests are not necessarily identical. In particular, a business may have to pay superannuation for an independent contractor engaged mainly for their personal labour, even when that contractor has an ABN.

Misrepresenting an employment relationship as contracting can also constitute unlawful sham contracting.

Official guidance:

• Fair Work Ombudsman — Independent contractor changes
• ATO — Super for independent contractors
• Fair Work Ombudsman — Sham contracting

These distinctions matter because the correct legal classification can affect a worker's entitlements and the responsibilities of the business engaging them.

The transport industry needs to distinguish between a rate that generates revenue for a carrier and a rate that allows a driver to earn a sustainable income.

A subcontractor's invoice value must cover the genuine costs of providing the service. That includes the vehicle, fuel, registration, insurance, tyres, servicing, tolls and other operating expenses, together with the financial consequences of unpaid time, periods without work and retirement planning.

A quoted annual turnover of $100,000 can sound attractive in a recruitment advertisement or contractor proposal. However, the example above demonstrates that this turnover may leave the driver with only around $40,500–$41,100 after the estimated operating costs and personal tax, before additional overheads and retirement savings.

That outcome is substantially different from an employee earning the average full-time adult salary, receiving approximately $83,159 in take-home wages and a further $13,002 in employer superannuation, alongside applicable paid leave and employment protections.

A sustainable transport model must look beyond headline turnover.

The important questions are:

1. 01What is the driver actually paid for the work performed?
2. 02Who carries the vehicle, fuel, maintenance and insurance costs?
3. 03Are empty kilometres, waiting time, loading time and administrative work adequately covered?
4. 04Can the driver take leave without jeopardising their household income?
5. 05Is there sufficient money left after expenses and tax to fund retirement and absorb unexpected costs?
6. 06Does the contractual arrangement accurately reflect the legal relationship and the responsibilities of the parties?

The answers determine whether a transport rate is commercially sustainable or simply looks attractive on paper.

A rate that stays at $2,000 a week also loses buying power when costs rise. The ABS reported 3.5% inflation in the year to July 2026. After a 3.5% price rise, $2,000 would need to become $2,070 merely to retain the same general purchasing power. That does not establish what a particular driver was paid in the past; it shows why a flat headline rate can leave less for the person doing the work.