FTC (Fuel Tax Credits) focus on providing a fuel tax credit (excise or import duty) for big and small companies included in the value of the fuel used in equipment, plant and machinery, heavy goods vehicles over 4.5 tons and light commercial vehicles under 4.5 tons, which travel off city highways or on private roads.
What's a fuel tax credit? How much can I get from them?
The ATO (Australian Taxation Office) offers Fuel Tax Credit government benefits to most business owners. It is because Fuel Tax Credits can be recovered for a broad range of business activities, except for the use of passenger cars on public roads.
The total number of fuel tax credits that you can declare in your tax return largely depends on when you purchase the fuel, what type of fuel you utilize, how it is used. Fuel Tax Credits may be declared on public roads for heavy trucks operating on liquid or mixed fuels such as petrol, diesel, B20, B5 or E10.
Fuel Tax Credits are declared in the BAS (Business Activity Statement) in a manner similar to how you declare GST credits. When filling out your BAS you should also consult an accountant on how to calculate fuel tax credit.
How much can you claim for fuel tax credit?
The latest Fuel Tax Credit Rates permit large vehicles to charge up to 16.5 cents a litre on public highways and up to 42.3 cents a litre for gas used by all personal commercial vehicles. This is theoretically an additional 25.8 cents you can demand your larger trucks and a max of 42.3 cents for your passenger cars for every litre of fuel you can assert to have been used off the public road system.
What can’t you claim?
The maximum fuel tax credit for larger trucks on public highways cannot be asserted on the basis of the Road User Fee.
A light car (less than 4.5 tonnes) driving on a public street is a prime example of a business being unavailable to claim fuel tax credit, but there are more cases where FTC is not available for your company that you should be aware of. The gas used for personal purposes, fuel you have not used, and aircraft fuels are also excluded from any claims for fuel tax credits.
What's the Road User Fee? And why is that important?
The public highway fuel tax credit receivable is equivalent to the overall possible fuel tax import duty minus the 25.8 cents a litre road usage fee. This road user charge is only for public highway use, which is why you can demand higher fuel tax credits on private roads.
The Road User Cost is the amount that the National Transport Commission has charged to each litre of diesel fuel used only by larger trucks on public highways to reclaim their part of the money of supplying and managing the public road system
In November 2017, the Transport and Infrastructure Council froze the road user charge at 25.8 cents a litre until the end of the fiscal year 2019-20.