ATO Interpretative Decision
ATO ID 2007/43
Excise
Fuel Tax Act 2006: Business taxpayers - registration for fuel tax creditsFOI status: may be released
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With effect from 1 July 2015, the term 'Australia' is replaced in nearly all instances within the Fuel Tax legislation with the term 'indirect tax zone' by the Tax and Superannuation Laws Amendment (2015 Measures No. 1) Act 2015. The scope of the new term, however, remains the same as the repealed definition of 'Australia' used in those Acts.
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is an entity's entitlement to fuel tax credits under section 41-5 of the Fuel Tax Act 2006 (FTA) affected by whether the entity is registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise?
Decision
No. An entity's entitlement to fuel tax credits under section 41-5 of the FTA is not affected by whether the entity is registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise.
Facts
An entity registered for goods and services tax (GST) prior to 1 July 2006
The entity acquired taxable fuel after 1 July 2006 for use in carrying on its enterprise.
The entity registered for fuel tax credits after it acquired the taxable fuel.
The entity is not covered by the exemptions in subsection 41-5(3) of the FTA.
Reasons for Decision
Section 41-5 of the FTA provides that an entity is entitled to a fuel tax credit for taxable fuel that it acquires, manufactures in, or imports into Australia to the extent to which the entity does so for use in carrying on its enterprise. A further requirement imposed by section 41-5 is that to be entitled, an entity must, subject to exceptions in subsection 41-5(3) of the FTA, be registered for GST or required to be registered for GST.
The Tax Office requires entities to register for fuel tax credits. However, this is merely an administrative requirement and has no basis in the fuel tax law. The registration process ensures an entity's Business Activity Statements, which are the approved forms for returns for fuel tax, are modified so that they include fuel tax labels to facilitate the claiming of fuel tax credits.
Therefore, the entity's entitlement to fuel tax credits is not affected by whether the entity was registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise.
Legislative References:
Fuel Tax Act 2006
section 45-1
Keywords
FTC registration
FTC requirement to be registered for GST
FTC taxable fuel
Fuel tax credits
ISSN: 1445-2782
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