What is fuel tax credits?
Fuel tax credits provide you with a credit for the fuel tax (excise or customs duty) included in the price of fuel you use for your business activities in:
- machinery
- plant
- equipment
- heavy vehicles.
You may also be entitled to fuel tax credits for non-transport gaseous fuels acquired from 1 July 2012 to 30 June 2014 and used in specified agriculture, fishing or forestry activities.
The only fuels that are not eligible are:
- aviation fuels (aviation gasoline and aviation kerosene) – unless you were declared by the Clean Energy RegulatorExternal Link as a designated opt-in person under the opt-in scheme from 1 July 2013 to 30 June 2014
- fuels you use in light vehicles of 4.5 tonnes gross vehicle mass (GVM) or less, travelling on public roads
- fuel you acquired but did not use because it was lost, stolen or otherwise disposed of
- some alternative fuels, such as ethanol or biodiesel that have already received a grant or subsidy.
You must be registered for both GST and fuel tax credits before you can make a claim. You claim fuel tax credits on your business activity statement (BAS).
Depending on your circumstances, you may also need to meet an environmental criterion for heavy diesel vehicles if they were manufactured before 1 January 1996.
You can find more information at Eligible activities, Registering and Heavy vehicles.
Background of fuel tax credits
On 1 July 2006, fuel tax credits were introduced for fuel used in heavy vehicles and in a range of other business activities.
Eligibility was expanded on 1 July 2008 to include (at a half rate) taxable fuels used in other business activities, machinery, plant and equipment as part of a gradual implementation. From 1 July 2012, these activities became eligible for the full fuel tax credit rate, but the rate for most is reduced by a carbon charge.
From 1 December 2011, excise or customs duty applies to gaseous fuels – that is, liquefied petroleum gas (LPG), liquefied natural gas (LNG) and compressed natural gas (CNG) – for transport use in most instances. From this date, fuel tax credits became available for duty paid gaseous fuels acquired, manufactured or imported for use in eligible off-road business activities.
Non-transport use of gaseous fuels is eligible for fuel tax credits in certain circumstances.
From 1 July 2012, under clean energy laws a carbon charge generally applied to certain taxable fuels that are combusted. Also, there were changes to non-transport gaseous fuels that affected fuel tax credit rates for certain activities.
From 1 July 2013, carbon charge amounts increased and there were other changes to non-transport LPG and LNG that affected fuel tax credit rates for certain activities.
From 1 July 2014, the carbon charge was repealed.
If you are claiming fuel tax credits for fuel acquired from 1 July 2014, refer to Fuel tax credits for business.