What are Fuel Tax Credits (FTC)?

Fuel tax credits provide businesses with a credit for the fuel tax (excise or customs duty) paid at the pump to run:

  • Light vehicles
  • Heavy vehicles
  • Operating machinery
  • Plant and equipment

 

The criteria for claiming FTC is quite specific and excludes things like light vehicles travelling on public roads as well as mileage travelled for private use of fleet vehicles. 

FTC is refunded to businesses monthly, quarterly or annually by the ATO via your Business Account Statements (BAS).

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How to calculate your FTC?

The amount of FTC you can claim depends on when the fuel was purchased, what sort of fuel it was and how it was used i.e. whether it was on a public road or off-road such as at a depot, farm etc. 

It’s also very common for some vehicles to use a tank of fuel on a combination of off-road and public road activities - so it needs to be documented and divided up between the different FTC rates. 

Fuel tax credit rates also change regularly, but currently range from 4.2 cents to 41.8 cents* per litre for off-road. 

Some fuels and activities are also not eligible for FTC – such as the fuel used on a public road for light vehicles (less than 4.5 tonnes gross vehicle mass (GVM)) or liquefied natural gas. 

The higher rate of fuel tax credits (currently up to 41.8 cents per litre*) can be claimed from the Australian Tax Office (ATO) whenever your vehicles or equipment are idling, driving or operating ‘off’ a public road.

*Note: Rates are as at 5 August 2019 – 31st January 2020. FTC rates are reviewed every six months so may differ slightly from those above.

The ATO table below outlines the fuels eligible for each FTC rebate.

Eligible fuel type

Unit

Used in heavy vehicles for travelling on public roads

All other business uses (including to power auxiliary equipment of a heavy vehicle) (see note 1)

Liquid fuels, for example diesel or petrol

cents per litre

16

41.8

Blended fuels: B5, B20, E10

cents per litre

16

41.8

Liquefied petroleum gas (LPG) (duty paid)

cents per litre

0.0

13.7

Liquefied natural gas (LNG) or compressed natural gas (CNG) (duty paid)

cents per kilogram

0.0

28.7

Blended fuel: E85

cents per litre

0.0

15.62

B100

cents per litre

0.0

5.6


*Note: Rates are as at 5 August 2019 – 31st January 2020. FTC rates are reviewed every six months so may differ slightly from those above.

 

What is classed as ‘off-road’ areas for FTC?

Off-road areas are classified as any travel off a public road and can include any of the following:

  • Truck stop
  • Vehicle depot
  • Farm
  • Mining site
  • Quarry
  • Logging site
  • Construction site
  • Loading dock
  • Private road
  • Council refuge site

 

FTC rebate exemptions

The following items are exempt from being claimed under the FTC scheme:

  • Aviation fuels
  • Fuel used in light vehicles travelling on public roads
  • Fuel used in heavy vehicles that don’t meet the specified environmental criteria for fuel emissions
  • FTC that has already been claimed earlier in the supply chain
  • Fuel that was stolen, lost or disposed of
  • Fuel used for private purposes

 

Let technology unlock the maximum FTC rebates for your business!

Technology, such as EROAD’s Fuel Tax Credit Solution, which has achieved an Australian Tax Office (ATO) class ruling, now eliminates the guesswork and admin to help unlock the maximum FTC rebates for your business.

While claiming FTC is optional, accurately documenting how and where you use your fuel with EROAD’s FTC solution means you can recover the maximum rebate you’re entitled to.

EROAD’s FTC Solution

  • Accurately maps and records your fleet’s locational and fuel usage data (on and off-road)
  • Automates your FTC to make it easier and save significant admin time
  • Claim up to 2.5 the standard on-road FTC rebate rate for off-road usage
  • Use technology to recover under-claimed FTC retrospectively for up to FOUR previous years
  • Easily claim off-road FTC for light vehicles
  • Create geofences for work sites near or close to public roads or construction zones to claim the maximum FTC entitlement 

 

Like this blog? Check out more FTC blogs here »

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