What is a fuel tax credit?

The Fuel Tax Credit (FTC) is a benefit for GST-registered businesses in Australia to claim back a portion of fuel tax paid (excise) that is used by auxiliary equipment, certain heavy machinery and vehicles driven on private roads. All vehicles purchased for business use are eligible, both heavy vehicles and light vehicles.

To claim fuel tax credit rebates a business, as part of their Business Activity Statement (BAS) return, will include records of eligible fuel purchases for fuel tax credit claims.

This includes the fuel type, off-road usage (e.g. driving on private roads vs public roads) and the applicable rate (see the Australian Taxation Office (ATO) website for the most recent fuel tax credit rates and full details on eligibility).

After the BAS tax return has been processed, a tax credit is issued to the business.

For many businesses, calculating fuel tax credits manually is too complicated to be worth their time. Using fuel tax credit software to automate the process minimises administration time and maximises the calculated credit entitlement, making the filing of fuel tax credits profitable.

This software (in partnership with providers of Australian street data) can automate the collection of engine data, such as fuel use and distance driven off road, from your fleet vehicles, making it a lot simpler, more accurate and faster to file a monthly return, helping you maximise your refund on the fuel tax credits your business is owed.

FTC is a good provision for any Australian business looking to minimise the impact of the price of fuel on their fleet operations, and in some industries such as forestry, it represents a significant saving on their total fuel bill.

As part of a fleet management solution it can help any business reduce their fuel usage for all commercial motor vehicles, regardless of the type of fuel they use including LPG or gaseous fuels.