Non-combustible use
You can claim fuel tax credits for taxable fuel (for example, diesel, heating oil, kerosene, fuel oil, toluene, mineral turpentine, white spirit, duty paid LPG, LNG or CNG) you use for a non-combustible use in your business.
Refer to Fuel tax credit rates and eligible fuels for the rates from 1 July 2012, for fuel you use for non-combustible activities. You need to use the rate that applied when you acquired the fuel.
Fuel tax credit rates for these non-combustible activities are not reduced by the carbon charge.
If your activity is not listed here, or you use fuel in an activity where the fuel is combusted (eg, in an internal combustion engine or burnt), it may be eligible under another activity.
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Non-combustible use means using fuel in a way that does not ignite or burn the fuel, for example:
- fuel you use directly in a non-fuel manner - that is, it is not combusted
- fuel you use as an input or ingredient in the manufacture of products that are not intended for combustion.
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Fuel you use directly in a non-fuel manner
This category includes fuel that you apply directly onto a surface and not to provide power, for example:
- fuel you use to clean machinery parts or drums
- diesel you spray directly onto a road as a sealant
- fuel you use as a mould release.
Fuel you use as an input or ingredient
You can use fuel in this category as an input or ingredient in the manufacture of another product, as long as that product cannot be used as a fuel in an internal combustion engine, or as a burner fuel. Examples include:
- printing inks
- paint
- plastics
- cleaning agents
- adhesives
- rubber products
- pharmaceutical products.
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We may issue a determination that a blend of a fuel with a non-fuel product does not constitute a fuel. If your blend is subject to such a determination, you may be entitled to fuel tax credits for the fuel component you use in making that blend.
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Example: Non-fuel uses
Ted's Paint Supplies purchases toluene (a fuel) to use in manufacturing paint. The price of the fuel includes the excise duty of 38.143 cents per litre.
Ted blends the toluene with other non-fuel products to make the paint that he then sells to his customers.
Ted is entitled to fuel tax credits of 38.143 cents per litre on the toluene because the final product (the paint) cannot be used as a fuel in an internal combustion engine.
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If you are not sure if the fuel you use to manufacture your products is eligible for fuel tax credits, you can request a private ruling from us. For more information about private rulings:
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Sections within Eligible activities
Last Modified: Wednesday, 12 December 2012