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ATO fuel tax credits are the excise tax that was paid on taxable fuel, then returned to the taxpayer in the form of tax credits when the fuel was used for specific business purposes.
Which Activities Qualify for ATO Fuel Tax Credits?
You can claim ATO fuel tax credits when you use fuel in your business activities in machinery, plant, equipment and heavy vehicles. The ATO fuel tax credit rate depends on how the fuel is used.
Not Eligible for Fuel Tax Credits
You cannot claim fuel use in light vehicles of 4.5 tonne gross vehicle mass or less, travelling on public roads.
Eligible for Fuel Tax Credits at 16.5 cents/litre (*rate valid until 30 June 2020)
You can claim ATO fuel tax credits for uses off public roads. For example, for use in mines sites, private roads, site access roads, construction sites, farms and so on. Some heavy vehicles are considered as being always used off public roads, even if they sometimes use public roads. Examples include tractors, graders, combine harvesters, fertiliser spreaders, wheeled bulldozers, forklifts, wheeled excavators, front end loaders, backhoe loaders, and graders.
You can claim ATO fuel tax credits for fuels used in auxiliary equipment in your heavy vehicles.
ATO Fuel tax credit rates change from time to time, so before claiming you need to check not only the category but also the current rate.
Many organisations underclaim their ATO fuel tax credits, because they don’t the data information to assemble a detailed claim.
A detailed claim often requires a manual and error-prone process of information gathering from a lot of difference sources including driver logs, fuel records, and others.
Organisations typically use the low 16.5c/litre claim rate for all their heavy vehicles’ fuel purchases to avoid this burden. They are likely underclaiming their tax credits, as off-road ATO fuel tax credits are worth over 2.5 times on-road credits,
You can make Retrospective Fuel Tax Credit Claims
You can claim ATO fuel tax credits within four years of the date you were required to lodge the Business Activity Statement (this is not considered to be a mistake or adjustment). Retrospective claims must use the rates applicable when the fuel was purchased. A retrospective claim can be based on a current consistent six month pattern of fuel use, ie, historical use data may not be required. In some cases, making a retrospective claim has led to large one-off payments.
Telematics Systems help you claim the maximum ATO Fuel Tax Credits
Telematics systems capture detailed data about what a vehicle is doing. You can prove when it’s been on or off public roads, when it’s been using auxiliary equipment, and so on. With this data, organisations can claim ATO fuel tax credits at the 42.3c/litre rate for –
heavy vehicles auxiliary equipment fuel usage
all vehicles offroad
idle offroad for heavy vehicles
Auxiliary equipment fuel usage
This is a 2.5 times better rebate. To see the impact, use the interactive rebate estimator below. You can use last year’s claim value, and adjust the slider to reflect the amount of fuel at the higher claim rate.
Interactive Rebate Estimator
Telematics systems enable you to establish a consistent pattern of business usage. The ATO allows taxpayers to use this pattern to make a retrospective claim of up to four years of under-claimed ATO fuel tax credits. (This is also shown in the calculator.)
How do Telematics Systems Calculate ATO Fuel Tax Credits?
Which Telematics Systems can help you claim ATO Fuel Tax Credits?
The following telematics systems can help you claim Fuel Tax Credits –
What are fuel tax credits?
ATO Class Rulings
An ATO Class Ruling means that a telematics system has been approved to create records for calculating fuel use. If you use a system that has an ATO Class Ruling, the tax law must be applied in the way it is described in the ruling. It means that you are protected from paying any underpaid tax, penalty or interest if the ruling is incorrect.
Benefits of Telematics Systems for ATO Fuel Tax Credit Calculations
You can automate your claim for fuel use for both powered vehicles and auxiliary equipment
You will not underclaim or overclaim. You will get every dollar owed to you
Your claims can be backdated by up to four years if you can show a pattern of consistent fuel use. This can mean significant one-time returns. You can backdate claims even if you have already made a claim at the lower rate.
You will reduce admin effort on making ATO fuel tax credit claims
You can more accurately claim ATO fuel tax credits for offroad fuel use, which are over 2.5 times more valuable than on-road credits
You can set up geofences to ensure your claim is the maximum allowed
Additional Benefit of using FMS with ATO Class Ruling –
The tax law must be applied as described in the ruling. You will be protected from paying any underpaid tax, penalty or interest if the ruling is incorrect. |