New way to work out your fuel tax credits

tax credits

The ATO has recently released a simpler way to calculate fuel tax credits for diesel used in heavy vehicles.

If you claim less than $10,000 each year and use a heavy vehicle, you can use the new basic method for heavy vehicles.

The method makes it easier to work out your fuel tax credit (FTC) claim, including your on and off public road use.

As the rate for travel off public roads is higher, you will get more fuel tax credits if you calculate your off public road use correctly.

Travel off public roads includes when you’re idling, loading or unloading your heavy vehicle in warehouses, depots or car parks.

All you need is the distance you’ve travelled and the amount of eligible diesel you’ve acquired for use in the heavy vehicle for the tax period to use the method.

The Australian Trucking Association (ATA) said these changes will greatly assist these businesses with calculating their entitlement for fuel used off-road, which is claimable at the higher fuel tax credit rate, but also prevent them from having to use costly GPS based FTC calculators that larger competitors have access too.

“We welcome this move by the ATO and anything that makes it easier for companies to claim their correct amount of FTCs,” said Chris Sant from FTC advisors, Ryan Tax Services.

“Unfortunately, FTCs has become a very difficult issue for trucking clients and companies can rely upon this and sleep at night knowing they are getting their correct entitlement without having to paying extra for it.

“This is clearly the ATO putting their toe in the water, I wouldn’t be surprised if the ATO expand to larger companies. We would welcome this as it would reduce the complexity of the system and allow companies to maximum their entitlement.”

The ATA said it agrees with Sant’s comments and also noted that the ATO is expected to publish guidance in respect of the use of GPS data to calculate FTC claims.

The ATO guidance is expected to alert companies to over-claims being made by trucking companies who’ve relied upon advice of certain GPS providers and advisor firms.

ATO tips:

  • Use the basic method for heavy vehicles when you lodge your next BAS. Follow the steps on the ATO website at
  • If you’ve just started using fuel in your business, check if you are eligible for  fuel tax credits on the ATO website at

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