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  • Packaged for use other than in an internal combustion engine

    Find out about:

    Liquid fuels

    You can claim fuel tax credits when you package certain liquid fuels for use other than in an internal combustion engine (even when that product is capable of being used in an internal combustion engine) if all of the following apply:

    • the fuel is one of the following:
      • kerosene
      • mineral turpentine
      • white spirit
      • liquid aromatic hydrocarbons (such as benzene, toluene, xylene)
      • another petroleum product as defined in sub-item 10.28 of the Schedule, including its imported equivalent
       
    • the fuel is packaged in containers of 20 litres or less
    • the fuel is packaged for use other than in an internal combustion engine.

    The packaging of these fuels (including any images or text forming part of the packaging) must not suggest or imply that the fuel can or should be used in an internal combustion engine.

    See also:

    • Schedule to the Excise Tariff Act 1921

    Fuel blends

    You can also claim fuel tax credits when you package certain fuel blends for use other than in an internal combustion engine (even when that product is capable of being used in an internal combustion engine) if all of the following apply:

    • the blend includes one or more of the following fuels  
      • heating oil
      • fuel oil
      • kerosene (other than for use as a fuel in an aircraft)
      • liquid aromatic hydrocarbons (such as benzene, toluene, xylene)
      • mineral turpentine
      • white spirit
      • another petroleum product defined at sub-item 10.28 of the Schedule to the Excise Tariff Act 1921 (the Schedule) (including their imported equivalents)
      • product classified at sub-item 10.30 of the Schedule (including its imported equivalent) that does not contain a fuel classified at sub-items 10.1 to 10.12 (inclusive), 10.17, 10.20 or 10.21 of the Schedule
       
    • the blend is packaged in containers of 20 litres or less.

    The packaging of the fuel blend (including any images or text forming part of the packaging) must not suggest or imply the fuel can or should be used in an internal combustion engine. The end use of these fuel and fuel blends can include paint thinners, printing inks or cleaning solvents.

    The Schedule provides a list of all fuels that are subject to excise duty. Fuels are categorised by their generic type (for example, diesel or petrol) and classified by a sub-item number. Exclusions apply to sub-items 10.1 to 10.12 (inclusive), 10.17, 10.20 or 10.21 of the Schedule. These relate primarily to road transport and aviation fuels, including petrol and diesel.

    See also:

    • Schedule to the Excise Tariff Act 1921
    • Fuel Tax Act 2006 Subdivision 41-10 Fuel tax credit for fuel to be sold or packaged
    • ATO ID 2015/20 Petroleum: Fuel blends that can be used as fuel in an internal combustion engine.

    Fuel blends packaged in containers greater than 20 litres

    When you package blends in containers greater than 20 litres, claiming fuel tax credits will depend on whether the blend that you have manufactured can be used as a fuel in an internal combustion engine.

    If the fuel blend that you manufacture can be used in an internal combustion engine, you will not have an entitlement to fuel tax credits. The entitlement to a fuel tax credit passes to the end user of the blend.

    If the fuel blend cannot be used in an internal combustion engine, then you may have an entitlement to fuel tax credits.

    If the fuel or fuel blend that you manufacture can be used in an internal combustion engine then, regardless of the size of the product packaging, excise is payable on the entire blend. You may need to hold an excise manufacturers licence and pay excise duty on any components that have not previously had excise duty paid on them.

    Eligibility to claim fuel tax credits for blends you produce

    The following table shows how to work out if you are eligible to claim fuel tax credits for blends your produce

    Table: How to work out if you're eligible to claim fuel tax credits for blends you produce

    Check

    Question

    Yes

    No

    1

    Is the blend clearly a non-fuel product (for example, paint)?

    You are entitled to fuel tax credits for the taxable fuel used in making the product.

    Go to 2

    2

    Is the blend determined not to be a fuel?

    You are entitled to fuel tax credits for the taxable fuel used in making the product.

    Go to 3

    3

    Are you packaging a blend that meets the Fuel Tax Regulations?

    You are entitled to fuel tax credits for the taxable fuel in the blend you package.

    Go to 4

    4

    Based on your assessment, can the fuel be used in an internal combustion engine?

    (If you are unsure, you can request a private ruling).

    You are not entitled to fuel tax credits for the taxable fuel used in making the product.

    You are entitled to fuel tax credits for the taxable fuel in the blend you package.

      Last modified: 03 Apr 2017QC 18872