• Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Gaseous fuels

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    If you use gaseous fuels (acquired from 1 December 2011) in eligible business activities, you may be entitled to fuel tax credits. Gaseous fuels are:

    • liquefied petroleum gas (LPG)
    • liquefied natural gas (LNG)
    • compressed natural gas (CNG).

    Transport gaseous fuels are duty paid and include:

    • LPG or LNG intended for use in an internal combustion engine of a motor vehicle or vessel (boat, etc), either directly or by filling another tank connected to such an engine
    • CNG that is imported or compressed for use as a fuel in a motor vehicle – excluding CNG that is compressed at a residential premises using equipment capable of compression at a rate not more than 10 kg of natural gas per hour and not for sale
    • all gaseous fuels for mixed use (that is, both transport and non-transport use) or where the end use is unknown.

    Fuel tax credit rates for transport gaseous fuels increased on 1 July 2012, 1 July 2013 and 1 July 2014 due to the annual increases in excise duty for gaseous fuels. Some fuel tax credit rates for these fuels were also reduced by carbon charge amounts from 1 July 2012 to 30 June 2014.

    Non-transport gaseous fuels include:

    • LPG and LNG delivered only for use other than in an internal combustion engine of a motor vehicle or vessel (for example, in residential heating or burner applications) or for use in forklifts. The invoice for non-transport LPG generally includes the statement ‘Not to be used, or supplied, for transport use. Penalties apply.’
    • CNG imported or compressed only for use in forklifts or not for use as a fuel in a motor vehicle. It also includes CNG compressed at a residential premises (including for use in a motor vehicle) using equipment capable of compression at a rate not more than 10 kg of natural gas per hour and not for sale.

    From 1 July 2012 to 30 June 2013, excise duty equal to the carbon charge applied to LPG and LNG supplied for non-transport use. From 1 July 2013 to 30 June 2014, the carbon charge was applied via the carbon pricing mechanism.

    From 1 July 2012 to 30 June 2014, the carbon charge was applied to CNG supplied for non-transport use via the carbon pricing mechanism.

    Danger

    Penalties apply if you use or supply non-transport LPG for transport use.

    End of danger

    Example: LPG supplied for non-transport use

    In August 2013, Universal LPG delivers bulk LPG to Outback Mining. Outback Mining uses the LPG to fuel their electricity generator.

    Universal LPG has not paid excise duty on the LPG because it is supplied for non-transport use. Instead, Universal LPG settles their carbon liability on that fuel under the carbon pricing mechanism.

    The invoice from Universal LPG is marked 'Not to be used, or supplied, for transport use. Penalties apply'. Outback Mining is not entitled to claim fuel tax credits for their non-transport use to fuel the generator.

    End of example
      Last modified: 19 Sep 2014QC 41272