ATO ID 2007/43: Fuel Tax Act 2006: Business taxpayers - registration for fuel tax credits
Date of decision: 26 February 2007
Business line: Indirect Tax

Issue
Is an entity's entitlement to fuel tax credits under section 41-5 of the Fuel Tax Act 2006 (FTA) affected by whether the entity is registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise?

Decision
No. An entity's entitlement to fuel tax credits under section 41-5 of the FTA is not affected by whether the entity is registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise.

Facts
An entity registered for goods and services tax (GST) prior to 1 July 2006 The entity acquired taxable fuel after 1 July 2006 for use in carrying on its enterprise. The entity registered for fuel tax credits after it acquired the taxable fuel. The entity is not covered by the exemptions in subsection 41-5(3) of the FTA.

Reasons for decision
Summary: Section 41-5 of the FTA provides that an entity is entitled to a fuel tax credit for taxable fuel that it acquires, manufactures in, or imports into Australia to the extent to which the entity does so for use in carrying on its enterprise. A further requirement imposed by section 41-5 is that to be entitled, an entity must, subject to exceptions in subsection 41-5(3) of the FTA, be registered for GST or required to be registered for GST. The Tax Office requires entities to register for fuel tax credits. However, this is merely an administrative requirement and has no basis in the fuel tax law. The registration process ensures an entity's Business Activity Statements, which are the approved forms for returns for fuel tax, are modified so that they include fuel tax labels to facilitate the claiming of fuel tax credits. Therefore, the entity's entitlement to fuel tax credits is not affected by whether the entity was registered for fuel tax credits at the time that it acquired taxable fuel for use in carrying on its enterprise.

Legislative references: Fuel Tax Act 2006 section 45-1
Subject references: FTC registration FTC requirement to be registered for GST FTC taxable fuel Fuel tax credits