FUEL TAX CREDIT ENTITLEMENT EXPANDS FROM 1st July 2008
Eligibility for fuel tax credits from 1st July 2008 to include all taxable fuels use in machinery, plant and equipment for business activities not previously eligible. If you were previously not eligible for fuel tax credits, you may now be able to claim credits on fuels that you acquire from 1st July 2008. If you are already claiming fuel tax credits, you should check to see if more of your fuel is eligible from 1st July 2008.
Most fuels (including petrol) are eligible for a rebate except:
- Aviation fuels
- Alternative fuels such as liquefied petroleum gas (LPG), compressed natural gas (CNG), liquefied natural gas (LNG), ethanol and biodiesel
- Fuels used in vehicles of less than 4.5 tonne gross vehicle mass (eg cars) travelling on a public road.
To illustrate the scope of changes coming into force, the fuel used in tractors operated on golf courses and around supermarkets to collect trolleys is now eligible for a rebate. Fuel used on construction sites to power equipment, drive earth moving equipment or to produce electricity is also eligible for a rebate.
To be eligible for fuel tax credits you must be registered for both GST and the Fuel Credit Scheme. Fuel tax credits can be claimed through your Business Activity Statement. It is important to note that the fuel tax registration is separate and additional to GST registration.
If you are likely to claim more than $3 million of fuel tax credits in a financial year, you must register for Greenhouse Challenge Plus (GCP) to recieved any amounts over this threshold. The $3 million threshold is calculated differently for GST groups, branches and joint ventures.
GCP is administered by the Department of the Environment, Water, Hertiage and the Arts. It is a joint initative between the Government and Industry. Under the program, members sign an agreement with the Government under which they will initiate and report on actions to reduce emissions.
For businesses that were already claiming fuel tax credits before 1st July 2008, the rate of rebate for taxable fuels that became eligible from 1st July 2008 will be the same as the rate applicable to the exisitng eligible fuels. For example, if you are in the mining industry and have been claiming the diesel and oil rebate at 38.143 cents per litre, from 1st July 2008, you would also be eligible for a rebate on petrol at the rate of 38.143 cents per litre.
If you were not eligible for fuel tax credits previously but became so on 1st July 2008 due to the Fuel Tax Credit expansion, you will be entitled to 50% of the full rebate (ie $19.0715 cents per litre) on all taxable fuels (subject to the limitations discussed earlier). The 100% rebate for expanded eligible activities will come into effect from 1st July 2012.
Prepared by: PKF Chartered Accountants & Business Advisors