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 for different business activities
- apportioning fuel use on or off public roads – this affects the rate claims can be made
- imperfect GPS or telematics technology to support claims
- 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, 'Tips to avoid common errors' tools and safe harbours 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:
- fuel tax credit tools
- eligibility tool to check if you can claim
- calculator to work out the amount you can claim
- simplified fuel tax credits
- certainty around claiming
- records you need to keep and advice on apportionment methodologies
- Taxpayer Alert 2021/3 Fuel tax credit overclaims arising from aggressive marketing and use of GPS telematics technology products
- fuel schemes