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Hydrogen Production Tax Incentive

How to claim the Hydrogen Production Tax Incentive (HPTI) tax offset for producing renewable hydrogen in Australia.

Last updated 4 September 2026

About the incentive

In the 2024–25 Budget, the Australian Government announced its Future Made in AustraliaExternal Link package. This package supports Australia's transition to a net zero economy.

The Future Made in Australia package includes a temporary Hydrogen Production Tax Incentive (HPTI). This is to support the production of renewable hydrogen in Australia. The HPTI will help companies commence medium to large scale production of renewable hydrogen in Australia, while the market is still developing.

The HPTI is a refundable tax offset of $2 per kilogram of eligible hydrogen produced by eligible companies. It applies to hydrogen produced in income years between 1 July 2027 and 30 June 2040, for a maximum of 10 years.

Administration

The ATO and Clean Energy RegulatorExternal Link (CER) jointly administer the HPTI:

  • We administer the HPTI tax offset claimed in your company tax return.
  • CER administers the Guarantee of Origin (GO) Scheme (GO SchemeExternal Link). They will verify the details of your eligible hydrogen production.

Eligibility

Both your company claiming the offset and the hydrogen you produce must satisfy the eligibility criteria for the HPTI.

Eligible companies

To be an eligible company for the HPTI, you must meet the following criteria:

  • You are either
    • an Australian resident company that has an ABN
    • a foreign resident company that has a permanent establishment in Australia and an ABN.
  • You hold a production profile certified by the CER while producing the hydrogen.
  • You are subject to Australian tax for any income from your hydrogen producing activities.
  • You reach your final investment decision before 1 July 2030 (for production profiles approved from 1 July 2030), including for construction of new facilities or upgrades.
  • You comply with the rules implementing the Community Benefit Principles for the HPTI.

Entities that are not corporations, such as trusts or partnerships, are not entitled to the HPTI.

Eligible hydrogen

To be eligible hydrogen for the HPTI, the hydrogen you produce must meet all of the following criteria. The renewable hydrogen is:

  • produced in Australia at a single facility on or after 1 July 2027 and before 1 July 2040 (the HPTI period)
  • produced under a production profile certified by the CER
  • produced at a facility that has a capacity to produce hydrogen, in accordance with the production pathway, that is at least equal to that of an electrolyser with a nameplate capacity of 10 megawatts
  • not produced using either coal gasification or steam reformation of natural gas in the production pathway
  • certified by a Product Guarantee of Origin certificate (PGO certificate) under the GO Scheme, which verifies
    • the facility producing the hydrogen
    • the hydrogen's production emission intensity did not exceed 0.6 kg of carbon dioxide (CO₂ e) for each kilogram of hydrogen
    • that if electricity used was from a grid, it satisfies the grid matching requirements.

What you can claim

You can claim a refundable tax offset of $2 per kilogram of eligible hydrogen produced.

Eligible claim period

You can claim the HPTI tax offset for income years that:

  • start on or after 1 July 2027
  • end on or before 30 June 2040.

The offset period for each facility and production pathway is up to 10 years.

How to apply

To apply for the HPTI, you must complete requirements with both the CER and the ATO:

Steps 1–6: Complete requirements with CER

The requirements to be completed with CER are:

  1. register for the GO Scheme
  2. register your production profile
  3. certify your production profile
  4. create and register PGO certificates
  5. complete an Annual Reconciliation Check
  6. comply with reporting requirements for Community Benefits Principles.

For more information and to complete these steps, go to the Clean Energy Regulator websiteExternal Link.

Step 7: Claim the incentive with the ATO

Once you have completed the steps with CER, you can claim the HPTI in your company's tax return.

We will process your claim in accordance with the eligibility to the tax offset and use information in your PGO certificates to verify your eligibility.

Legislation

The Hydrogen Production Tax Incentive is established through amendments to the Income Tax Assessment Act 1997 and was introduced by the Future Made in Australia (Production Tax Credits and Other Measures) Act 2025External Link.

For more information, see:

QC103852