Fuel Tax Credits

December 7, 2021

How to maximise your Fuel Tax Credits and ensure you receive your full entitlement

If fuel management plays a large part in the day-to-day activities of your business, you probably already know how important it is to your bottom line to be able to accurately measure and track your fuel deliveries, track dispensing, and identify areas of fuel loss. This enables you to make significant savings (in both fuel and dollars). A high level of accuracy is key to effective fuel management and to maximising the Fuel Tax Credits and other government rebates available to you, allowing you to take full advantage of every opportunity to put money back in your pocket.

What are Fuel Tax Credits?

In many countries, you can claim government rebates for the fuel tax (the excise or customs duty) included in the purchase price of eligible fuels you have purchased and used in the course of carrying out eligible business activities, including for some non-fuel uses. Examples of ‘non-fuel uses’ include the use of other fuels in the cleaning of machinery drums and parts, the release of mould, and as an ingredient or component of products being manufactured.

Fuel Tax Credits can represent significant, tangible value to business owners who acquire fuel for the purpose of enabling their heavy vehicles and road transport vehicles to travel on public roads. There are even more generous rebates available to business owners who acquire eligible fuels for the purpose of powering heavy machinery, plant, auxiliary equipment, and light fleet vehicles that require fuelling for offroad use.

Businesses with eligible claims for government fuel rebates are essentially reimbursed by the ATO for the fuel tax incorporated in the price paid for the fuel. The rebate reimburses a certain number of cents, based on the percentage of your fluid that can be reconciled and how it was actually used (with proof). The rebate set for 1 July 2021 to 31 January 2022, for fuelling heavy vehicles for travel on public roads is 16.9 cents per litre, and for all other eligible business uses is 43.3 cents per litre. For businesses that use large quantities of eligible fuels and high-value liquid assets, this can equate to hundreds of thousands of dollars a year, or more!

Who is eligible to claim for Fuel Tax Credits?

There are only two requirements that must be satisfied for a business to be able to submit a claim for Fuel Tax Credits in Australia:

  1. The business claiming the credits must be registered for GST when the fuel was acquired
  2. The business claiming the rebate must be registered for fuel tax credits when the claim is lodged
Who is eligible to claim for Fuel Tax Credits?

What other eligibility criteria must be met to claim Fuel Tax Credits?

While it may be simple enough to meet the above criteria, eligibility requirements for Fuel Tax Credits centre more on the fuel itself and the use it will be put to. The rebates are only provided on certain types of fuels acquired for certain purposes.

Eligible types of fuels include both gaseous fuels (such as LPG) and liquid fuels (such as diesel, petrol, and other fuels such as mineral turpentine, kerosene, white spirit, and some solvents), however there are some business activities for which only specific taxable fuels may be claimed. Fuel blends may be eligible for fuel tax credits, however the rate able to be claimed by the business will depend upon the composition of the fuel blend – specifically, the exact amount of ethanol or biodiesel in each blend.

How do you claim Fuel Tax Credits?

Businesses report their fuel usage and claim fuel tax credits via their business activity statement (BAS), in much the same way as they claim GST credits. The Australian Taxation Office (ATO) assesses the claim against the eligibility criteria, decides whether to approve it and, if all conditions are met, issues the business with the Fuel Tax Credits for which they are eligible.

How do you ensure you receive the maximum rebate on Fuel Tax Credits?

How do you ensure you receive the maximum rebate on Fuel Tax Credits?

Your ability to prove that fuel acquired by you is of a type that is eligible to be claimed and is being used for an eligible purpose, is crucial to establishing and maintaining your business’s eligibility to claim the maximum rate of Fuel Tax Credits. However, ensuring you can claim the maximum rebate you’re entitled to also relies on your ability to accurately measure the amounts of fuel received and used.

Fuel Management Systems (FMS) and Fuel Tax Credits

Perhaps the simplest, fastest, and most logical way to improve your business’s ability to claim (and receive) its full entitlement to Fuel Tax Credits is to ensure that you have a fuel management system (FMS) whose components can work together to accurately measure or calculate the amount of fuel received, dispensed, and used, allowing you to better track and manage fuel movements and usage.

Your FMS should enable you to confirm you are receiving the amount of fuel you’re paying for, and to monitor and control your fuel stocks and refuelling activities – such as:

Ideally, choose an integrated system with fluid transfer components and technology that work together seamlessly to manage the entire fuel management process lifecycle.

Banlaw’s Fuel Management System can help you to better manage your fuel – to protect your assets, make significant savings and maximise your Fuel Tax Credits.

The best fuel management system for you will help you better manage (measure, track, and monitor) your fuel, and collect more accurate data on fuel movements and the authorised assets that consume your fuel, helping you maximise the Fuel Tax Credits or other government rebates available to you.

There are several fuel management systems (FMS) on the market, and, while most of them carry out similar functions, each has its own individual strengths and points of difference. Banlaw’s Fuel Management System is the only complete, end-to-end fuel management system available, comprised of discrete, high-quality components and precision instrumentation that work together synergistically with our Restrack RMS software, to help ensure you receive your full entitlement of fuel credits or government rebates. We are pleased to say that data produced by Banlaw’s Restrack RMS software, and relied upon by many large Banlaw clients, has been audited by the ATO and passed with flying colours.

There is a lot of value in obtaining audit-ready data automatically, and our sturdy and reliable hardware and sophisticated software helps you manage the entire fuel management process – from fuel nozzles that help to control flow rates and fuel safety, to precision automatic tank gauging capabilities that enable you to monitor fuel stock quantities in real time, to refuelling hardware that contains RFID technology for automatic identification of vehicles and operators.

Contact Banlaw today to find out more about how our complete fuel management system can help you monitor your fluid assets and maximise the Fuel Tax Credits you receive back from the Australian Tax Office

For more information on how we can help your business improve your fuel monitoring capabilities, so you can collect more accurate figures on fuel movement and usage, track every drop of liquid, and make significant savings on both fuel and money through the maximised accurate claiming of Fuel Tax Credits, contact Banlaw today. Click here for Australian and international contact details, or to find a local distributor. Alternatively, click here to complete our online contact form and a Banlaw representative will contact you shortly.

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