Are you eligible to claim fuel tax credits?

tax credits accountants

By Michael Craig

Michael Craig

Does your business use fuel for the following?

  • Heavy vehicles used on public roads
  • Machinery
  • Plant
  • Equipment

Fuel tax credits are a refund of part of the fuel tax (excise duty or customs duty) included the price of any eligible fuel that a business purchases, manufactures or imports to use in the business.

The amount of the fuel tax credits available to a business is dependent on:

  • The type of fuel
  • When the fuel was acquired
  • What the fuel was used for

The main examples of taxable fuel are diesel and petrol, but also include gaseous fuels, such as LPG and CNC, and other fuels, such as kerosene, heating oil and mineral turpentine.

Fuel tax credits do not apply to the following:

  • Fuels used in light vehicles travelling on public roads (GVM of 4.5 tonnes or less)
  • Fuels used in pre-1996 heavy vehicles that do not meet specified environmental criteria
  • Aviation fuel
  • Ethanol blends where the ethanol component exceeds 10%
  • Biodiesel blends where the biodiesel component exceeds 20%

The fuel tax credit rates vary depending on the business use so it is important to ensure that the correct rate is claimed. The 2016/17 liquid fuel rates are as follows (per the ATO website):

Business use Rate for fuel acquired from 1 Jul 2016 Rate for fuel acquired from 1 Aug 2016
In a heavy vehicle (including emergency vehicles) for travelling on public roads 13.6* 13.7*
All other business uses – such as on private roads, off public roads and non-fuel uses 39.5 39.6
To power auxiliary equipment of a heavy vehicle travelling on public roads – such as fuel used to power a refrigeration unit or a concrete mixing barrel 39.5 39.6
Packaging fuels in containers of 20 litres or less for uses other than in an internal combustion engine 39.5 39.6
Supply of fuel for domestic heating 39.5 39.6

 Notes to table

* This rate accounts for the road user charge (which is subject to change) and applies to fuel used in a heavy vehicle for travelling on public roads.

Want to know more?

If you would like to know more about the issues raised in this article, please contact Michael Craig our Business Advisory Senior Manager for assistance.

An Important Message

While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents.  Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.



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