On 4 February 2019, the rates for business fuel tax credit increased. These rates regularly change, typically in February and August, in line with fuel excise indexation and the consumer price index (CPI).
If you plan on claiming fuel tax credits for your business, it is important you have a clear understanding of what these credits are and when/how you can claim them.
What are fuel tax credits?
Businesses can receive a credit for fuel tax (excise or customs duty) that is included in the price of fuel.
Fuel tax credits are available for businesses who use fuel in:
- Machinery
- Plant
- Equipment
- Heavy vehicles
- Light vehicles travelling off public roads or on private roads
Can I claim fuel tax credits?
It’s important to recognise that the eligibility for credits depends on a number of things, including: what fuel is used, the activity it is used in, and where the fuel is purchased. While there are many points to bear in mind, these are the main considerations:
- Is your vehicle over 4.5 tonnes gross mass?
- Is your vehicle travelling off public roads or on private roads?
The ATO have created a helpful tool for understanding your eligibility.
How are fuel tax credits claimed?
Fuel tax credits are claimed similarly to how GST credits are claimed on your business activity statement (BAS). You can either claim the credits immediately, or within four years of acquiring the fuel.
The current rates are below:
| Rates for fuel acquired from 4 February 2019 to 30 June 2019 | |||
| Eligible Fuel Type | Unit | Used in heavy vehicles for travelling on public roads | All other business uses (including to power auxiliary equipment of a heavy vehicle) |
| Liquid fuels (diesel or petrol) | cents per litre | 15.8 | 41.6 |
| Blended fuels (B5, B20, E10) | cents per litre | 15.8 | 41.6 |
| Liquified petroleum gas (LPG) | cents per litre | 0.0 | 13.6 |
| Liquified natural gas (LNG) or compressed natural gas (CNG) | cents per kilogram | 0.0 | 28.5 |
| Blended fuel: E85 | cents per litre | 0.0 | 13.210 |
| B100 | cents per litre | 0.0 | 4.2 |
Source: ATO
As with all tax office claims, you must keep records to support your claim. This means holding onto receipts that demonstrate proof of purchase, and recording odometer readings/ fuel usage reports to segregate between eligible and ineligible activities.
To help you calculate your fuel tax credits, the ATO have developed a calculation tool.
Fuel tax rates change often. It is vital that you refer to the ATO website to check the current rates and ensure your claim is accurate.
For further assistance, please contact a small business Tax Champion.
