Fuel tax credits for business
This provides you with general information on fuel tax credits, including:
Fuel tax credits generally provide you with a credit for the excise or excise equivalent customs duty included in the price of fuel you use for your business in:
- machinery
- plant
- equipment
- heavy vehicles.
Eligibility
Warning:
This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
End of attentionThere are four questions to ask about receiving fuel tax credits:
Eligible businesses
Before you can make a claim, you must be registered for both goods and services tax (GST) and fuel tax credits. You claim fuel tax credits on your business activity statement (BAS).
Most businesses can claim fuel tax credits. The amount of fuel tax credits you can claim depends on what fuel you use, when you acquired it and how you use it. Depending on your circumstances, you may also need to meet an environmental criterion for heavy diesel vehicles that were manufactured before 1 January 1996.
Eligible fuels
You can claim fuel tax credits for any taxable fuel you acquired, manufactured or imported to use in your business.
Fuel is generally considered taxable fuel if an excise or excise equivalent customs duty is required to be paid on it. Examples of taxable fuels are:
- diesel
- petrol
- kerosene
- heating oil
- toluene
- fuel oil
- transport liquefied petroleum gas (LPG)
- transport liquefied natural gas (LNG)
- transport compressed natural gas (CNG).
Eligible activities
You can claim fuel tax credits for the fuel you use in road transport, all other business uses, and packaging or supplying fuel.
Road transport
You can claim fuel tax credits for the fuel you use in road transport using:
- vehicles with a gross vehicle mass (GVM) greater than 4.5 tonnes travelling on public roads
- diesel vehicles you acquired before 1 July 2006 with a GVM equal to or greater than 4.5 tonnes travelling on public roads.
The fuel tax credit rate for fuel used in heavy vehicles for travelling on public roads is reduced by the road user charge (which is subject to change). Fuel used in auxiliary equipment (for example, a cement mixer or refrigeration unit) in heavy vehicles while travelling on public roads is not reduced by the road user charge.
End of attentionAll other business uses
You can claim fuel tax credits for the fuel you use in all other business uses on private roads, off public roads and for non-fuel uses.
Examples of the activities
- Agriculture
- Fishing
- Forestry
- Mining
- Construction
- Manufacturing
- Marine and rail transport (including emergency vessels)
- Nursing and medical
- Burner applications
- Electricity generation by a commercial generation plant, stationary generator or a portable generator
- Wholesale/retail
- Property management
- Landscaping
- Non-fuel uses include fuel you use
- directly as a mould release
- as an ingredient in the manufacture of products that cannot be used as fuel in an internal combustible engine.
Packaging or supplying fuel
You can claim fuel tax credits for the fuel you use in packaging or supplying fuel – including:
- packaging certain fuels in containers of 20 litres or less
- filling transport LPG into cylinders of 210 kg or less for supply for non-transport use
- supplying transport LPG for residential use
- supplying certain fuel for domestic heating.
Activities and fuels that are not eligible
Some activities and fuels are not eligible, including:
- fuels you use in light vehicles with a GVM of 4.5 tonnes or less travelling on public roads, for example, a car, small van or taxi
- gaseous fuels you use in heavy vehicles for travelling on public roads, as the road user charge reduces the fuel tax credit to nil. (However, you can claim for gaseous fuels that power auxiliary equipment in heavy vehicles.)
- aviation fuels (aviation gasoline and aviation kerosene)
- some alternative fuels, such as ethanol or biodiesel, that have already received a grant or subsidy
- fuel you acquired but have not used because it has been lost, stolen or otherwise disposed of.
Rates
Fuel tax credit rates are indexed every six months in line with the consumer price index - generally on 1 February and 1 August . Rates for fuel used in heavy vehicles for travelling on public roads are also subject to change due to periodic changes in the road user charge.
When calculating your fuel tax credits, including fuel used in heavy vehicles, you need to use the rate that applied when you acquired the fuel – this may not necessarily be the rate in effect when you use the fuel or claim your fuel tax credits.
How to claim
You must assess your fuel tax credit claims yourself. This means you are responsible for:
- assessing your own eligibility for fuel tax credits
- working out the dollar amount you can claim by multiplying your eligible litres by the correct fuel tax credit rate
- keeping records that support your claims.
Get your claim right
The following tips and tools can help you get your fuel tax credit claim right.
Use the right rate
Check the right rate online each time you lodge your BAS. For current and previous years’ rates, refer to Fuel tax credit rates and eligible fuels.
Check your fuel use is eligible
A common mistake is to claim for vehicles with a GVM of 4.5 tonnes or less travelling on public roads. To help avoid mistakes, use our Fuel tax credit eligibility tool.
Keep records to support your claim
Your records need to show how you apportioned fuel for different activities.
Check your calculations
A common mistake is claiming fuel tax credits based on the cost of the fuel instead of the quantity of fuel multiplied by the relevant rate. To help work out your entitlement use our:
Check your contracts
The wording of the contract may affect who can claim fuel tax credits.
Find out more
End of find out moreMore information
If you do not speak English well and want to talk to a tax officer, phone the Translating and Interpreting Service (TIS) on 13 14 50 for help with your call.
People who are deaf or have a hearing or speech impairment can contact us through the National Relay Service (NRS). There are two easy steps:
TTY users can also contact us by our direct TTY line 13 36 77.
For ATO 1800 free-call numbers, phone 1800 555 727.
You can also visit one of our shopfronts or speak to your registered tax agent.
General information about fuel tax credits for business.