What are Fuel Tax Credits? An introduction

When the everyday punter on their daily drive pulls into a garage to fill up, they are making a tax contribution to the Federal Government via Fuel Tax. The rate of fuel tax at the time of writing (July 2024) is 49.6 cents per litre (CPL).

Enter stage left a GST-registered business who can claim all or a portion of this Fuel Tax in their BAS, depending on how the fuel is used. We will call this hypothetical business Ilovefooty Pty Ltd (ILF).

ILF runs a plumbing business and pulls into a garage and fills up:
• A tip truck with a Gross Vehicle Mass (GVM) greater than 4.5 tonnes – 100 litres of diesel;
• A mini excavator – 50 litres of diesel; and
• A jerry can to run a generator on site – 20 litres of ULP.
Total litres 170.

ILF can now enter the world of Fuel Tax Credits and has two choices.
1. Do nothing and pay the full pump price for the fuel, which is $340 at $2 per litre for 170 litres; or
2. Keep records to detail the diesel that has gone into the tip truck and the mini excavator. The ULP will be fine as it should be recorded on a separate line on the garage’s tax invoice.

Assuming ILF has kept appropriate records it can claim the following amounts as Fuel Tax
Credits for:
• The tip truck 49.6 CPL used on site or operating the PTO, and
19.1 CPL used for travelling on a public road.
Assuming the tip truck is used 5% on site and 95% for travelling on a public road
5% of 100 litres – 5 litres. 5 litres at 49.6 CPL – Fuel Tax Credit $2.48
95% of 100 litres – 95 litres. 95 litres at 19.1 CPL – Fuel Tax Credit $18.15
• Mini Excavator 50 litres at 49.6 CPL – Fuel Tax Credit $24.80
• Jerry can of ULP 20 litres at 49.6 CPL – Fuel Tax Credit $9.92

Happy days for ILF because they have saved $55.35 on the pump price, thanks to the Fuel Tax Credit Scheme.
Whether you are just starting up, or are already up and running contact us via email at ftcnational.com.au or call or text 0494 021 084 to discuss how to claim Fuel Tax Credits and utilise our “No win, no fee” policy.