Eligibility - domestic electricity generation
You can claim fuel tax credits for taxable fuel, such as diesel or petrol, you acquire for use in generating electricity for domestic purposes. The fuel can be used to generate electricity using a motor or generator, for yourself or others.
When we say 'for domestic purposes', we mean for a home, house or household. This includes a:
- static home such as a single house, duplex, town house, unit or cabin
- relocatable home such as a demountable home
- marine home such as a houseboat
- mobile home such as a caravan or motor home.
Generally, you are only entitled to fuel tax credits for electricity you generate for the home if it is the main or permanent place of residence.
You cannot claim fuel tax credits for electricity you generate for recreational purposes, including for use in a:
- holiday caravan
- tent
- yacht.
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Domestic electricity generation does not include fuel you use to generate electricity for business or commercial purposes - this must be claimed on your business activity statement (BAS).
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When you cannot claim for domestic electricity generation
You are not eligible to claim fuel tax credits for some fuels you use in domestic electricity generation. They are:
- 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 another grant or subsidy
- fuels where fuel tax credits have already been claimed by a business earlier in the supply chain, for example
- kerosene packaged in containers of 20 litres or less
- heating oil supplied for home heating
- duty paid LPG supplied for residential use, or packaged for supply in containers of 210kg or less.
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For more information about how to claim for fuel used in generating electricity for business or commercial purposes, refer to Fuel tax credits for business (NAT 14584).
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Example 1: Domestic electricity generation only
Lauren lives in a remote location and uses a petrol-powered generator to generate electricity for her lighting, heating and other domestic requirements.
She is entitled to claim fuel tax credits for the petrol she uses in her generator as the fuel is for use in domestic electricity generation.
Lauren will claim her fuel tax credits on her fuel tax credit claim form and her claim will be reduced by the carbon charge that applies to petrol.
Example 2: Domestic and business electricity generated by a sole trader
Judith is a sole trader registered for GST. She lives in a remote location on the coast and operates a café and fish and tackle business which is located in a building at the front of the same property as her home.
She has two diesel-powered generators she uses to:
- produce electricity for her home on the property
- produce electricity for her café and fish and tackle business.
Judith is entitled to claim fuel tax credits for diesel used in both generators because the fuel is used in domestic electricity generation and to carry on her business.
As Judith is registered for GST, she must claim fuel tax credits on her BAS for both the domestic and business electricity she generates. Judith's claim will be reduced by the carbon charge that applies to diesel.
Example 3: Domestic and business electricity generated by related entities
David is the director of Smith Pty Ltd and he operates a restaurant business through the company. The company purchases diesel for use in the business for electricity generation and bore pumps and claims its fuel tax credits on its BAS. The company's claim will be reduced by the carbon charge that applies to diesel.
David uses a diesel-powered generator to generate electricity for lighting, heating and other domestic requirements for his home which is located on a property next to the business. He is entitled to fuel tax credits for the diesel used in the generator at his residence. David is not personally registered for GST and, as he pays for the fuel himself, he will claim his fuel tax credits on his fuel tax credit claim form. David's claim will be reduced by the carbon charge that applies to diesel.
Last Modified: Wednesday, 1 August 2012