Excise guidelines for the fuel industry

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7 REMISSIONS, REFUNDS, DRAWBACKS AND EXEMPTIONS

7.1 PURPOSE

This Chapter deals with:

when you can apply for a remission, refund or drawback
what happens if you are overpaid a refund or drawback
when fuel products are exempt from excise duty
how to apply for a remission, refund or drawback, and
penalties that can apply to offences in relation to remissions, refunds, drawbacks and exemptions.

7.2 INTRODUCTION

A remission of excise duty extinguishes the liability for duty that was imposed at the point of manufacture. In other words, no excise duty will ever be paid on goods subject to remission.

A refund is the return of excise duty that you have already paid.

A drawback is a refund that applies where duty-paid goods are exported.

In some circumstances the duty you pay on goods may be subject to a complete or partial refund or drawback. [180]

7.3 POLICY AND PRACTICE

7.3.1 APPLYING FOR A REMISSION OF EXCISE DUTY

You can apply for a remission of excise duty payable on your ' excisable fuel products ' if the following circumstances apply while the goods are subject to ' excise control ':

where the fuel products have deteriorated or been damaged, pillaged, lost or destroyed. [181]

'Pillage' means 'to strip of money or goods by open violence, as in war; plunder'. [182] This does not cover simple cases of theft.

'Lost' in this context does not simply mean cannot be found. For example, a tank may spring a leak and it is known that the fuel has drained away. The fuel has been lost and cannot be used by anyone as a fuel.

For more information about payment of duty, see Chapter 6 Payment of duty.


Example 7A

Fuel which is underbond is accidentally destroyed by fire. The owner applies for a remission of duty on the destroyed fuel. If approved, this would extinguish the duty liability.


where goods are not worth the amount of excise duty that would be payable on the goods if delivered into ' home consumption ' [183]

this is unlikely to apply to petroleum products as they are likely to be used in the manufacture of other excisable goods (for example, by blending or re-refining the product) which is permitted by section 24 of the Excise Act or because they are likely to be used as a burner fuel within the premises covered by the licence in which case duty would be payable at the fuel rate

recycled hydraulic oil, brake fluid, transmission oil, transformer oil or heat transfer oil (classified to ETA 15.2), delivered in accordance with your PSP, for which no benefit is payable under the Product Stewardship (Oil) Regulations 2000 and that has been used for the same purpose for which it was used before being recycled [184]
the fuel is used in the manufacture of goods that are not excisable and is chemically transformed (other than by combustion) in that manufacture [185]

this circumstance applies where a fuel product is transformed through a chemical reaction (other than combustion) to produce an entirely different substance that is no longer an excisable product, as in some large-scale petrochemical manufacturing processes
the remission does not apply where fuel is merely mixed with other substances to make products such as solvents, cleaning agents or paint.

When excisable fuel products are subject to remission without application

Excisable fuel products, to which items 10 and 15 of the excise tariff apply, may be subject to remission without application (effectively meaning they are exempt from duty) when the fuel products are for official use but not for trade by [186] :

the Governor-General or any member of the Governor-General's family and state Governors or any member of a state Governor's family [187]
the Australian American Foundation and the ANZAC Agency for the Pacific Region of the Commonwealth War Graves Commission [188]
the Government of another country, under an agreement between that Government and the Australian Government [189]
a foreign country under a Status of Forces agreement with the Australian Government [190] , or
a diplomatic or consular mission and the goods are delivered under your PSP. The fuel in this circumstance can also be for personal use. [191]


Example 7B

A manufacturer receives an order from a diplomatic mission for fuel, for official use. The manufacturer delivers the fuel into home consumption (to the diplomatic mission), under the terms of their PSP. (The conditions listed on the PSP may require the manufacturer to submit an Excise remission to us, after delivery of the fuel.)


If you are uncertain whether a circumstance falls into one of these categories, you should contact us on 1300 137 290 .

To supply fuel products under these circumstances, you must first ensure the receiver meets the relevant criteria. For example, you should only accept orders, stating that the goods are for official use, on the official stationery, or official order, of eligible people or organisations. You must keep a copy of this documentation.

You do not have to apply for a remission and you do not have to include these products on your ' excise return '.

Remission of excise duty on LPG and LNG

The fuel products are LPG or LNG that are not for use in an internal combustion engine

An automatic remission of duty is available without application where you are a licensed person or a holder of a PSP (or both) and deliver LPG or LNG into home consumption (this includes own use) that is not for use, or intended for use, in an internal combustion engine in either a motor vehicle or vessel. [192]

A remission cannot apply if:

the LPG or LNG is delivered for mixed use (both non-transport and transport) and is delivered into the same tank, or
you do not know the end use of the LPG or LNG.

The remission applies at the time the LPG or LNG is delivered.

For more information about periodic settlement permissions, refer to Chapter 6 Payment of duty.


Example 7C: LPG delivered under settlement permission

Elizabeth's business is licensed for excise purposes. It supplies LPG to Kathleen's business for the purposes of heating during the 2014–15 financial year. As Kathleen will not be using the LPG for transport purposes, the remission applies and Elizabeth will not need to pay duty on the LPG.

Example 7D: LPG delivered for mixed use

Aaron manufactures LPG. Aaron delivers the LPG to Christopher in a bulk tank for transport and non-transport use. The LPG is excisable. As Aaron supplies the LPG to Christopher for mixed use, he cannot apply a remission to the LPG.
This means that Aaron must pay excise duty at the transport rate in relation to all the LPG supplied to Christopher. Christopher may be entitled to a fuel tax credit depending on his use of the fuel.

Example 7E: LPG delivered for transport use by a distributor

Huey's business is licensed for excise purposes and supplies LPG to a site specified in a manufacturers licence held by Daisy's Distributors. Daisy holds a movement permission that allows the LPG to move from the site covered by Huey's licence without duty being paid. Daisy's business distributes the LPG to both transport and non-transport customers. Where Daisy distributes the LPG to service stations and trucking companies for transport purposes, Daisy will be required to pay duty on the fuel and no remission will be available.


For more information about movement permissions, refer to Chapter 5 Movement permissions.

Notice requirements for LPG delivered under remission

If you hold a manufacturer or storage licence and you supply or sell LPG to which a remission applies at the time of supply or sale, you must give a notice to your customer. [193]

If you on-sell or on-supply LPG on which a remission applied, and at the time of the on-sale or on-supply a remission continues to apply, you must give a notice to your customer that a remission applied to the LPG. [194]

The notice must include the words: 'Not to be used, or supplied, for transport use. Penalties apply'. [195]

You are not required to give notice for LPG you supply:

in, or into, a 210 kilogram container, or
to a residential premises and some or all of the LPG is not supplied for the purpose of carrying on an enterprise. [196]

Penalty or offence relating to LPG delivered under remission

You may be subject to a penalty of one ' penalty unit ' if you do not give the notice when required. [197]

Penalty for using LPG subject to remission for an excisable LPG use

You may be subject to a demand for payment from us if:

LPG is sold or supplied to you
you use the LPG for an excisable LPG use, and
an LPG remission applied to the LPG at the time of the use. [198]

The amount demanded will be equal to 2 times the amount of excise duty that would be payable on the LPG if it had been entered for home consumption on the day the demand is issued. [199]

The phrase 'excisable LPG use' means to use LPG in a system for supplying fuel to an internal combustion engine of either a motor vehicle or a vessel, either directly or by filling another tank connected to such an engine.

The phrase 'excisable LPG use' does not include the use of LPG for a vehicle that is designed to move goods with a forklift and is for use primarily off public roads.

Penalty for unlawfully selling LPG subject to remission that is used for an excisable LPG use

You commit an offence if:

you intentionally sell LPG
you know that, or are reckless as to whether, the LPG will be used for an excisable LPG use
the LPG is used for an excisable LPG use, and
you did not pay excise duty on the LPG as a remission applied to the LPG at the time of the use. [200]

The penalty is 2 years imprisonment or the greater of:

500 penalty units, and
5 times the amount of duty that would be payable on the LPG at the rate of duty payable on the penalty day. [201]

For more information about offences and penalties, refer to Chapter 9 Offences.

Remission of excise duty on the supply of bunker fuel to certain vessels

An automatic excise remission can be applied to bunker fuel supplied directly from an excise-licensed site directly to the vessel where [202] :

excise duty is payable on goods that are classified to item 10 (other than aviation fuels) of the Schedule to the Excise Tariff Act
the goods are stores for the use of passengers or crew of the ship, or for the service of the ship
the goods are supplied from premises covered by a licence granted under section 39A of the Excise Act to the ship
the goods are supplied to a person for the purpose of carrying on an enterprise (within the meaning of the A New Tax System (Goods and Services Tax) Act 1999 )
the ship has a gross tonnage (within the meaning of the Shipping Reform (Tax Incentives) Act 2012 ) of at least 400
the ship is not an overseas ship within the meaning of the Excise Act.

7.3.2 APPLYING FOR A REFUND OF EXCISE DUTY

You can apply for a refund of excise duty paid on excisable fuel products if the following circumstances apply.

Duty has been paid on fuel that was lost or destroyed

You can apply for a refund of duty paid on excisable fuel products if it is later found that, while the goods were subject to excise control (that is, while they were at the site covered by a licence), they deteriorated or had been damaged, pillaged, lost or destroyed. [203]

Duty-paid fuel products, while the goods are subject to excise control, are not worth the amount of excise duty paid

You can apply for a refund of duty paid on excisable fuel products, if, while the goods are subject to excise control, are not worth the amount of excise duty paid. [204] This circumstance is unlikely to arise in respect of petroleum products. The goods are likely to be used in the manufacture of other goods (through blending or re-refining) or are likely to be used as a burner fuel. The circumstance has more relevance to excisable alcoholic beverages. However the following example is included for illustrative purposes.


Example 7F

A holder of a manufacturer licence who does not have a PSP pays the excise duty on fuel products, being 50 litre drums of solvent, in accordance with a pre-payment return. They receive a delivery authority. Before the fuel products are removed from premises covered by a licence, they become unsaleable, due to changed packaging requirements resulting from legislative changes made by the state Government relating to the labelling of hazardous goods, and the fuel cannot be sold as it is uneconomical to repackage.
As the fuel products were still subject to excise control when they became not worth the amount of duty paid on the goods, the licence holder can apply for a refund of duty on the fuel products (and provide supporting documentary evidence). However the licence holder would remain accountable for the goods. They could either use the goods in the manufacture of other excisable goods (by re-refining or blending) pursuant to section 24 of the Excise Act or they can seek our permission to destroy the goods (and we can either attend the destruction or otherwise advise them as to what evidence of the destruction would satisfy us). Once the goods have been destroyed with our permission a remission of duty would be available without application.


Duty has been paid on LPG for non-transport use through manifest error of fact or patent misconception of the law

You can apply for a refund of duty paid on LPG that is sold for non-transport use, if it is incorrectly duty-paid as the distributor did not apply the remission. This only applies if the LPG was sold to a person for a price that excluded the excise duty amount. If it included an amount for excise duty, a refund would only be payable if an amount equal to the excise duty has been refunded or credited to the person. [205]

This is to avoid the end-user claiming a fuel tax credit on the LPG in addition to a refund claim being made by the supplier.

Duty has been paid on goods (other than gaseous fuel) through manifest error of fact or patent misconception of the law

You can apply for a refund of duty paid on goods (other than gaseous fuel) if duty has been paid through manifest error of fact or patent misconception of the law. [206]

This circumstance applies to an error that is evident, obvious or apparent and also in situations where duty has been paid for goods entering home consumption that are not in fact excisable. In both cases a refund of the duty paid would be payable.


Example 7G

The system used by an entity to record deliveries into home consumption and calculate their duty liability on a weekly basis, incorrectly identifies a sale of kerosene for aviation use as tariff item 10.16 and pays excise duty at a rate of $0.508 per litre rather than the applicable rate of $0.03556 per litre. The entity identifies the error after the end of the settlement period. It is eligible to apply for a refund for the difference between the duty paid and the duty payable.


Duty-paid goods have been taken up as ship's stores or aircraft's stores

Ship's stores on ships undertaking an international voyage and aircraft stores on aircraft undertaking international flights are not subject to excise duty. Where duty has been paid and the excisable fuel products are subsequently re-directed for use on ships or aircraft travelling overseas (for example, bunker fuel), this refund circumstance may apply. [207] As fuel that is used to power a ship or aircraft falls within the definition of ship's and aircraft's stores, a refund is payable on excise duty paid on fuel that is subsequently used in overseas ships and international aircraft. This circumstance does not apply where a fuel tax credit entitlement exists.

By-law reduces duty rate of goods

A refund is available for duty-paid goods if a by-law is subsequently made under Part XV of the Excise Act with the effect that duty is not payable or is payable at a reduced rate. [208]

Goods including fuel, gaseous fuel, oil and grease are returned to a manufacturer or to a warehouse

A refund is available where unused duty-paid goods are returned to premises covered by a licence or a person authorised by the manufacturer to receive goods on their behalf, and the items are destroyed, or subjected to further manufacture or production. [209]

Returns can occur for a number of reasons, including contamination or over-delivery. This refund ground does not apply if the vapour recovery unit refund ground applies; see below.

Duty that is paid on certain fuel is returned to a premise covered by a licence and processed by vapour recovery units

This circumstance relates to vapour that is pumped out of a tank at a service station and captured within tanks on the delivery truck when fuel is delivered. The vapour is extracted from the tanker back at the premises covered by a licence, is converted back to a liquid form to be re-refined and blended to eventually form part of another delivery.

Method to calculate vapour recovery refunds

From 1 July 2024, a simple method to calculate vapour recovery refunds has been legislated which is subject to a refund limit. The refund is for excise duty that has been paid on gasoline and diesel products (including blends) that have not been used, where the vapour is returned to premises covered by an excise licence and processed by a vapour recovery unit. It only applies to those fuels delivered into home consumption on or after this date. [210]

The method for determining the refund amount of the recovered fuel vapour has 2 steps [211] :

Step 1

Add the following 2 amounts:

duty that was paid on any quantity of gasoline, including for use as fuel in aircraft, and blends of gasoline and ethanol (subitems 10.5, 10.6 and 10.7 of the Schedule to the Excise Tariff Act); and
duty that was paid on so much of any quantity of diesel or blends of diesel and either biodiesel or ethanol (classified under subitems 10.10 and 10.12 of the Schedule to the Excise Tariff Act) that does not exceed twice the quantity of gasoline goods above.

Step 2

Multiply this sum by 0.0006442.

The result is the refund amount.

Where the volume of diesel or diesel blends exceeds twice the volume of gasoline or gasoline blends you enter during the refund period, it will be reduced to an amount that is twice the amount for gasoline for the purposes of the refund calculation. If no gasoline is delivered in the refund period, no refund will be available.


Example 7H – ratio of diesel to gasoline is within limit

A taxpayer applies for a refund of excise duty paid on 150,000 litres of diesel (subitem 10.10) and 100,000 litres of gasoline (subitem 10.5) that were delivered into home consumption for the week Saturday 14 September to Friday 20 September 2024. The requirements for the refund are met.

Diesel to gasoline loading = 1.5:1 (150,000 to 100,000), therefore below 2:1 limit

Duty paid on gasoline - 100,000 litres x $0.508 cpl = $50,800

Duty paid on diesel – 150,000 litres x $0.508 cpl = $76,200

Amount of refund = ($50,800 + $76,200) x 0.0006442 = $81.81

Example 7I – ratio of diesel to gasoline exceeds limit

A separate taxpayer applies for a refund of excise duty paid on 1,500,000 litres of diesel (subitem 10.10 of the Schedule to the Excise Tariff Act) and 100,000 litres of gasoline (subitem 10.5 of the Schedule) that were delivered into home consumption for the week Saturday 14 September to Friday 20 September 2024. The requirements for the refund are met. Here, the 2:1 limit is applied to the diesel quantities as the ratio of diesel to gasoline is 15:1. The refund amount will only reflect duty paid on 200,000 litres of diesel and duty paid on the remaining 1,300,000 litres of diesel is disregarded for refund purposes. The amount of duty paid on 200,000 litres of diesel is added to the amount of duty paid on the 100,000 litres of gasoline, and this amount is multiplied by 0.0006442. The result is the refund amount.

Volume of dutiable diesel delivered = 1,500,000 litres

Volume of dutiable petrol delivered = 100,000 litres

Diesel to gasoline loading = 15:1 (1,500,00 to 100,000) therefore 2:1 limit applies based on petrol volume

Diesel capped at 2 x volume of petrol = 2 x 100,000 = 200,000 litres

Duty paid on gasoline - 100,000 litres × $0.508 cpl = $50,800

Duty paid on diesel – 200,000 litres x $0.508 cpl = $101,600

Amount of refund = ($50,800 + $101,600) x 0.0006442 = $98.18


Duty has been paid on excisable fuel products to which items 10 and 15 of the excise tariff apply, and they are sold in certain circumstances

A refund may be made where duty has been paid on excisable fuel products to which items 10 and 15 of the excise tariff apply, and they are sold in the following circumstances:

for the official or personal use of diplomatic or consular staff of foreign countries [212]
for use by the Government of another country, under an agreement between that Government and the Australian Government and not for trade [213]
for the official use of a foreign country under a Status of Forces agreement with the Australian Government and not for resale [214] ,or
for the official of an international organisation or personal use of the holder of a high office of an international organisation to which the International Organisations (Privileges and Immunities) Act 1963 applies. [215]

Certain recycled hydraulic oil, brake fluid, transmission oil, transformer oil or heat transfer oil

A refund may be made for recycled hydraulic oil, brake fluid, transmission oil, transformer oil or heat transfer oil (classified to ETA 15.2), delivered in accordance with your PSP, for which no benefit is payable under the Product Stewardship (Oil) Regulations 2000 and that has been used for the same purpose for which it was used before being recycled. [216]

7.3.3 APPLYING FOR A DRAWBACK OF EXCISE DUTY

You can apply for a drawback if you export fuel products that have had excise duty paid on them. [217]

Drawback of duty is not payable in the following circumstances:

the goods are stabilised crude petroleum oil or condensate there is no drawback of duty paid under items 20 or 21 of the Schedule to the Excise Tariff Act [218]
the goods are liquid petroleum obtained from naturally occurring petroleum gas [219]
if the excise duty has been refunded on the exported fuel products [220]
if after exportation the fuel products are re-landed in Australia [221] ,or
the exported goods are relevant fuel which an entity has or had an entitlement to a fuel tax credit under the Fuel Tax Act 2006 , or does or did not have an increasing fuel tax adjustment for the fuel. [222]

We will only pay a drawback if [223] :

Prior to the exportation, you advise us via a notice that you intend to claim a drawback. (We can exempt you from this requirement, in writing, either on all claims for drawback or any particular claim.) [224]
Before exportation of the duty-paid fuel products, the goods are available for our inspection.
You keep records including those that show

that duty was paid on the fuel products (for example, an invoice), and
the fuel products were exported (for example, an export declaration number or bill of lading).

You lodge a drawback claim in the approved form no later than 12 months after the fuel products are exported.
The claim sets out the amount of drawback and a statement that the goods have not been, or are not intended to be re-landed in Australia.
The amount of the claim or an aggregate of claims is at least $50.

The amount of the drawback cannot exceed the amount of excise duty that was paid. [225]


Example 7K

A fuel contractor arranges for duty-paid diesel to be sent to researchers studying porpoises on a remote Fijian island. The diesel is stored in 208 litre (55 US gallon) drums and stowed in the cargo hold of a ship. The contractor buys 20,000 litres of duty-paid diesel fuel from a fuel depot and arranges the shipping. The amount of excise duty on the fuel is $10,160.00 (20,000 × $0.508).
The contractor applies for a drawback of the duty paid on the fuel. To support the application, they provide the ATO with a copy of the invoice for the fuel purchase, and a copy of the Certificate of Clearance stamped and issued by the Australian Border Force.


Fuel used in an overseas ship and international aircraft that meets the definition of ship's stores and aircraft's stores (fuel bunkers) is not considered to be exported because it is exempt from excise duty (see below). In a situation where these fuels are delivered duty-paid to overseas ships or international aircraft an entitlement to a fuel tax credit or a refund of the excise duty may arise.

For more information about fuel bunkers, refer to Bunker fuel and commercial shipping .

7.3.4 IF YOU ARE OVERPAID A REFUND OR DRAWBACK

If we overpay you by way of a refund or drawback, you must pay the overpaid amount back. We can demand that you pay back the amount and if you do not repay the amount within the time specified in the demand, we can recover the amount through the courts as a debt due to the Commonwealth. [226]

7.3.5 WHEN EXCISABLE FUEL PRODUCTS ARE EXEMPT FROM EXCISE DUTY

Excisable fuel products are exempt from duty if they are:

exported
sold for use as ship's or aircraft's stores [227]
with our approval, delivered as small samples [228] , or
subject to remission without application. [229]

Ship's and aircraft's stores

Ship's and aircraft's stores are goods for the use of passengers or crew on an international journey or for the service of ships or aircraft on an international journey. It includes fuel used to power the overseas ship and international aircraft. [230]

If you supply ship's or aircraft's stores ' ', you must obtain a movement permission to move the goods from premises covered by a licence to the place of export.

Delivering samples without payment of duty

You may be able to deliver small samples without payment of duty and without entry. You must apply to us for approval and your application must:

be in writing
specify who the sample is for
specify the quantity for approval, and
specify the purpose of the sample.

In determining what constitutes a sample, we would consider each application on a case-by-case basis, but as a guide, the sample volume would need to be less than 10 litres.

You do not include approved samples in your excise return; however, you must keep records of any samples you deliver.

To apply for approval, send your application to us by:

ATO Online Services , or
post to
Australian Taxation Office
PO Box 3514
ALBURY NSW 2640

When CNG, LPG and LNG is exempt from excise duty

CNG

CNG is exempt from duty if it was compressed:

for use other than as a fuel for a motor vehicle [231] , or
other than in the course of carrying on an enterprise [232] , or
for use as a fuel for a forklift vehicle that is used primarily off public roads [233] , or

at a residential premises
the rate at which the gas was compressed at those premises is not more than 10 kilograms of compressed natural gas per hour, and
the gas is not sold or otherwise supplied in the course of carrying on an enterprise. This gas can be used as a fuel for a motor vehicle. [234]

The phrase 'in the course of carrying on an enterprise' has the same meaning as when it is used in the A New Tax System (Goods and Services Tax) Act 1999 .

A 'residential premises' has the same meaning as given in the A New Tax System (Goods and Services Tax) Act 1999 .

LPG and LNG

LPG and LNG are exempt from duty if you are a licensed manufacturer and you use the fuel at the premises specified in the licence in the process of manufacturing [235] :

petroleum condensate or stabilised crude petroleum oil, or
liquefied petroleum gas, liquefied natural gas or other hydrocarbons. [236]

7.4 PROCEDURES

7.4.1 APPLYING FOR A REMISSION OR REFUND

An application for a remission (excluding automatic remissions) or refund must be submitted in the approved form and state the nature and particulars of the claim. Records to substantiate your claims must be maintained and produced when requested. [237]

For duty paid from 1 July 2024, you must lodge your refund application within 4 years after the day when the excise duty was paid for the following refund circumstances: [238]

fuel while subject to the CEO's control that has deteriorated, been damaged, pillaged, lost or destroyed, or become unfit for human consumption
fuel while subject to the CEO's control that is not worth the amount of duty paid on it
duty was paid on goods (other than gaseous fuels) through manifest error of fact or patent misconception of the law
LPG and LNG that is sold for non-transport use is incorrectly duty-paid as the distributor did not apply the remission (only applies if the LPG was sold to a person for a price that excluded the excise duty amount and if it included an amount for excise duty a refund would only be payable if an amount equal to the excise duty has been refunded or credited to the person)
fuel supplied as bunker fuel to a vessel or aircraft that undertakes an international voyage or flight that does not create an entitlement to a fuel tax credit
fuel which has not been used and returned to premises covered by a licence, or a person authorised by the manufacturer of the goods to receive goods on behalf of the manufacturer and are destroyed, or are subjected to further manufacture or production
vapour recovery refunds.

For all other table items listed in clause 1 of Schedule 1 to the Excise Regulation, there is no time limit for lodging your application for a refund.

We may inspect or supervise the disposal of goods to ensure that excisable fuel products that are the subject of a remission, due to deterioration or contamination, do not find their way into home consumption.

If underbond fuel products need to be destroyed off site, you must apply for a movement permission to move them from premises covered by the licence to the place of destruction. With permission, you may be able to move duty-paid goods that have been delivered into home consumption, and for which you have lodged a refund and remission claim, directly to a premises not covered by a licence for destruction. [239]

Unless fuel products have been accidentally destroyed, you should contact us before moving or destroying any that are subject to remission or refund. We will provide you with direction and advise if the goods are to be inspected or the destruction supervised.

For more information about movement permissions, refer to Chapter 5 Movement permissions.

You can elect to have a refund credited to your excise account or paid directly into your bank account. The easiest way to apply for a refund or remission is by using ATO Online services . Alternatively:

To apply for a remission, send us a completed Excise remission . Help to complete this form is available at Help completing the PDF form .
To apply for a refund, send us a completed Excise refund or drawback . Help to complete this form is available at Excise refund or drawback . Applications can also be made on company letterhead as long as all the relevant information is provided.

If you are not satisfied with our decision to refuse your refund or remission, you can request a review of our decision by lodging an objection within 60 days of our decision.

For more information about your review rights, refer to Chapter 8 Reviews and objections.

7.4.2 APPLYING FOR A DRAWBACK

The easiest way to claim your excise refund or drawback is by using ATO Online services. Alternatively, you can apply for a drawback of duty by sending us a completed Excise refund or drawback. Help to complete the form is available at Excise refund or drawback . Applications can also be made on company letterhead as long as all the relevant information is provided.

Your drawback application must be received not later than 12 months after the day on which the goods were exported. [240]

If we refuse to pay your drawback and you are not satisfied with our decision, you can request a review of our decision by lodging an objection within 60 days.

For more information about your review rights, refer to Chapter 8 Reviews and objections.

7.4.3 MORE INFORMATION

If you need more information on remissions, refunds, drawbacks and exemptions, contact us via:

phone 1300 137 290
ATO Online Services , or
write to us at
Australian Taxation Office
PO Box 3514
ALBURY NSW 2640

We will ordinarily respond to written information requests within 28 days. If we cannot respond within 28 days, we will contact you within 14 days to obtain more information or negotiate an extended response date.

7.5 PENALTIES THAT CAN APPLY IN RELATION TO REMISSIONS, REFUNDS, DRAWBACKS AND EXEMPTIONS

The following are the penalties that may apply after conviction for an offence.

Evade

If you evade payment of any duty which is payable, the maximum penalty is 5 times the amount of duty on the excisable fuel products or where a court cannot determine the amount of that duty the penalty is a maximum of 500 units. [241]

False or misleading statements

If you make a false or misleading statement, or an omission from a statement in respect of duty payable on particular goods, to us, a penalty not exceeding the sum of 50 penalty units and twice the amount of duty payable on those goods. [242]

7.6 TERMS USED

Excisable fuel products

Excisable goods are goods on which excise duty is imposed. Excise duty is imposed on goods that are manufactured or produced in Australia and listed in the Schedule.

As this Guide deals with fuel products, we have used the term excisable fuel products.

Excisable fuel products include:

petrol
diesel
renewable diesel
crude petroleum oil
condensate
heating oil
kerosene
fuel ethanol,
biodiesel
compressed natural gas (CNG)
liquefied natural gas (LNG), and
liquefied petroleum gas (LPG).

Excise control

Goods are subject to excise control from the point of manufacture until they have been delivered into home consumption or for export.

Goods subject to excise control cannot be moved, altered or interfered with except as authorised by the Excise Act.

Excise return

An excise return [243] is the document that you use to advise us the volume of excisable fuel products that you:

have delivered into home consumption during the period designated on your PSP, or
wish to deliver into home consumption following approval.

Home consumption

'Home consumption' [244] is the term used in the Excise Act and this Guide to describe when excisable fuel products are released into the Australian domestic market for consumption. The term used in the legislation is 'deliver for home consumption'.

Normally, this will be by delivering the goods away from premises covered by a licence but includes using those goods within those premises (for example, using fuel to run equipment in premises covered by your licence). It does not include goods delivered for export or the movement of goods underbond (see definition below) to another site covered by a licence.

The term 'home consumption' is not defined in the Excise Act and there is no definitive case law that looks at the issue in question. However there are several cases where issues closely related to it are considered. [245]

The conclusion drawn from those cases is that 'home consumption' refers to the destination of goods as being within Australia as opposed to exporting them.

Penalty units

The value of a penalty unit is contained in section 4AA of the Crimes Act 1914 , and is indexed regularly. The dollar amount of a penalty unit is available at Penalties .

Underbond

This is an expression not found in excise legislation but it is widely used to describe goods that are subject to excise control. Excisable goods that are subject to excise control are commonly referred to as 'underbond goods' or as being 'underbond'. This includes goods that have not yet been delivered into home consumption and goods moving between premises under a movement permission.

7.7 LEGISLATION (quick reference guide)

In this Chapter we have referred to the following legislation:

Excise Act 1901

subsection 4(1) – definitions
section 24 – excisable goods and goods liable to duties of Customs may be used in manufacturing excisable goods
section 58 – entry for home consumption etc.
section 61A – permission to remove goods that are subject to CEO's control
section 64 – delivery of samples free of duty
section 77HA – compressed natural gas that is exempt from excise duty
section 77HB – liquefied petroleum gas and liquefied natural gas that is exempt from excise duty
section 77L – notice requirements for sales or supplies of LPG to which an LPG remission applies
section 77M – penalty for using LPG for excisable LPG use
section 78 – remissions, rebates and refunds
section 79 – drawbacks
section 80 – recovery of overpayments of refunds, rebates, and drawbacks
section 117BA – unlawfully selling LPG that is used for an excisable LPG use
section 120 – offences
section 160A – ship's stores and aircraft's stores

Excise Regulations 2015

section 10 – application for remission, rebate or refund of excise duty
section 11 – period for making an application for refund or rebate of excise duty
section 14 – drawback of excise duty on goods
section 15 – when drawback of excise duty is not payable
section 16 – conditions relating to drawback of excise duty – general
section 22 – sales or supplies of LPG to which LPG remission applies - contents of notice
section 23 – sales or supplies of LPG to which LPG remission applies – circumstances when notice not required
clause 1 of Schedule 1 – circumstances in which remission, rebate or refund may be made on application
clause 2 of Schedule 1 – circumstances in which remission, rebate or refund may be made without application

Excise Tariff Act 1921

The Schedule

Crimes Act 1914

section 4AA – penalty units


Amendment history

27 June 2025
Part Comment
Throughout This chapter was updated to take into account the law changes as a result of the Excise and Customs Legislation Amendment (Streamlining Administration) Act 2024 and Excise and Customs Legislation Amendment (Streamlining Administration) Regulations 2024 . This includes:

extending the 12-month time limit for certain excise refunds to a 4-year time limit and apply this new time limit to certain refund circumstances currently with no time limit
providing for the remission of duties otherwise payable in respect of 'bunker' fuel used in certain shipping vessels undertaking domestic voyages
introducing a new refund circumstance with a standard formula for the refund of duty paid on fuels processed back into excisable fuel by vapour recovery units.

Throughout Updated in line with current ATO style and accessibility requirements.

Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).

References

Excise guidelines for the fuel industry
  Date: Version:
  1 July 2006 Updated document
  1 April 2015 Updated document
  12 July 2017 Updated document
  11 December 2017 Updated document
  4 June 2021 Updated document
  1 July 2024 Updated document
You are here 27 June 2025 Current document

Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).