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Ruling

Subject: Fuel tax credits and four year time limit

Question 1

Are you entitled to a decreasing fuel tax adjustment for diesel fuel purchased between 1 July 2003 and 30 June 2006 for which you have an entitlement under the Energy Grants (Credits) Scheme Act 2003 (EGCSA) if you are not currently registered for fuel tax credits?

Answer

No.

Question 2

Are you entitled to a decreasing fuel tax adjustment for diesel fuel purchased between 1 July 2003 and 30 June 2006 for which you have an entitlement under the Energy Grants (Credits) Scheme Act 2003 (EGCSA) if you register for fuel tax credits?

Answer

Yes.

This ruling applies for the following period/s:

2004-05 income year

2005-06 income year

The scheme commences on:

1 July 2004

Relevant facts and circumstances

You have enquired about the time limits on entitlements to fuel tax credits. Your entitlement to fuel tax credits is not at issue for this ruling.

You have lodged a number of BAS without fuel tax credits. You state you have since attempted to amend the June 2006 BAS for additional [GST] input tax credits but per a letter dated from September 2011 from the ATO, you were advised that you were not entitled to do so.

You state you now have documentation and the amounts necessary to claim for fuel tax credits for the 2005 and 2006 income years and refer to an attached schedule detailing diesel amounts per quarter:

2005

· 1 July to 30 September 2004

· 1 October to 31 December 2004

· 1 January to 30 March 2005

· 1 April to 30 June 2005

2006

· 1 July to 30 September 2005

· 1 October to 31 December 2005

· 1 January to 31 March 2006

· 1 April to 30 June 2006

You state you are aware that in most circumstances these amendments would be out of time but that you contend the email to the ATO officer referred to above serves as notice to the ATO of the additional fuel tax credit entitlements and is thus, in time.

As such, you seek clarification on amending the BAS for the 2006 income year and how fuel tax credits can be claimed for the 2005 income year per the abovementioned schedule.

You are registered for GST but are not registered for fuel tax credits.

Relevant legislative provisions

Fuel Tax (Consequential and Transitional Provisions) Act 2006 Division 2 of Part 2 of Schedule, item 9

Fuel Tax (Consequential and Transitional Provisions) Act 2006 Division 1 of Part 3 of Schedule 3

Fuel Tax (Consequential and Transitional Provisions) Act 2006 Division 2 of Part 3 of Schedule 3

Fuel Tax Act section 41-5

Reasons for decision

Section 41-5 of the Fuel Tax Act 2006 (FTA) provides that you are entitled to a fuel tax credit for taxable fuel that you acquire in Australia to the extent that you do so for use in carrying on your enterprise if you are registered for GST.

Entitlement to fuel tax credits is affected by Divisions 1 and 2 of Part 3 of Schedule 3 to the Fuel Tax (Consequential and Transitional Provisions) Act 2006 (FTCTPA) which operate to restrict entitlement to specific activities for fuel purchased between 1 July 2006 and 30 June 2012. However, the FTCTPA also acts to provide for entitlements that may have arisen under the Energy Grants (Credits) Scheme Act 2003 (EGCSA).

Division 2 of Part 2 of Schedule 3 to the FTCTPA provides for energy grants claimed under the FTA.

Item 9 of the FTCTPA provides that you have a decreasing fuel tax adjustment if you purchased diesel fuel between 1 July 2003 and 30 June 2006 and you were entitled to an on-road or an
off-road credit in respect of the fuel and you have not made a claim for payment of an energy grant in respect of the credit. The adjustment is attributable to a tax period that you choose that ends before 1 July 2009

You state you now have documentation and the amounts necessary to claim for fuel tax credits for the 2005 and 2006 income years and refer to an attached schedule detailing amounts per quarter. All periods referred to in your schedule are relevant for the purposes of item 9 of the FTCTPA, that is:

2005

· 1 July to 30 September 2004

· 1 October to 31 December 2004

· 1 January to 30 March 2005

· 1 April to 30 June 2005

2006

· 1 July to 30 September 2005

· 1 October to 31 December 2005

· 1 January to 31 March 2006

· 1 April to 30 June 2006

Whilst your entitlement to fuel tax credits is not at issue for this ruling, provided you:

· purchased on or off-road diesel fuel between 1 July 2003 and 30 June 2006,

· have an entitlement to an energy grant under the EGCSA, and

· have not already made a claim for payment of an energy grant in respect of the credit, and

· you register for fuel tax credits,

· you can choose to attribute the amount of the fuel tax credit as a decreasing fuel tax adjustment to a tax period that you choose that ends before 1 July 2009. To ensure you meet the requirements of the four year time limit for claiming fuel tax credits, you must make the adjustment before 1 July 2013.

In order to make the adjustment, you need to amend labels 7C and/or 7D on your BAS, to include the credit in your net fuel amount for the relevant tax period.

However, as you are not currently registered for fuel tax credits, you do not currently have fuel tax credit labels 7C or 7D on your BAS.

As such, until you register for fuel tax credits you will be unable to amend a previous BAS.

Registering

All businesses need to be registered for both GST and fuel tax credits before they can claim.

Your fuel tax credit period will be the same as the GST tax period that applies to you. Your GST tax period will not change because you register for fuel tax credits.

To register for fuel tax credits, you can:

· call 13 72 26 and provide your details using interactive voice recognition (IVR)

· complete the form Add a new business account (NAT 2954) from www.ato.gov.au, or

· phone 13 28 66 between 8.00am and 6.00pm, Monday to Friday.

You will need to request that your fuel tax credit registration be backdated to a period before 1 July 2009 in order to make your claims.