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ATO action to reduce the gap

Last updated 29 October 2023

The intention of fuel tax credits is to remove or reduce the cost of duty taxes on fuels used in business operations.

Different rates of credits apply depending on the fuel type and use. There are challenges for claimants due to complexities with:

  • fuel excise rate indexation and road user charge adjustments
  • apportioning fuel use on or off public roads – this affects the rate claims can be made
  • the temporary reduction in the excise rate
  • undertaking appropriate testing or evidence collection to support GPS or telematics technology-based claims.

We seek to sustainably manage the fuel tax credits gap by:

  • developing clear guidance and promoting the use of simple methods
  • setting firm expectations to help claimants and advisers
  • treating key compliance risks.

Our strategies are underpinned with the knowledge that supporting high levels of voluntary compliance is the best way to maintain the gap.

To help small businesses and taxpayers who are underclaiming, we created guides, calculators and Tips to get your fuel tax credits right tools that make it easy to claim the right amounts.

We will continue to identify and publish safe harbours to simplify claiming and reduce compliance costs. We will also promote and encourage early engagement with advisors and software providers to improve the accuracy and reliability of credit claims via our product rulings system.

We undertake compliance activity to address aggressive claiming or deliberate non-compliance. We monitor outlays and compare this against other data.

Tools and information

We continue to support taxpayers to get it right the first time. Our free tools and information include:

 

 

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