How Fuel Tax Credits Work for Australian Businesses
How it works
The Australian Government charges fuel excise on petrol, diesel, LPG and other fuels. Eligible businesses registered for fuel tax credits can claim some or all of that tax for fuel acquired and used in their activities.
The credit rate depends on fuel type, use and acquisition date. From 1 July to 2 August 2026, taxable liquid fuel attracts a 20.2c/L credit in heavy vehicles over 4.5 tonnes travelling on public roads and 36.6c/L for eligible off-road or other business use. The road user charge is reflected in the lower on-road rate. Fuel used by light vehicles on public roads is generally not eligible, even when the trip is for business.
Credits are claimed on your BAS at label 7D. Multiply the eligible litres by the rate in force on the date you acquired the fuel. Rates are generally indexed in February and August, but road user charge changes and temporary relief can create additional periods. Keep fuel purchase and use records showing the litres, acquisition date, supplier and business activity.
When to use this calculator
- You run a trucking, logistics, or transport business and want to estimate your quarterly fuel tax credit claim
- You operate farm machinery, mining equipment, or generators that run on diesel and want to check your off-road credit rate
- You want to see the difference between the on-road heavy vehicle rate and the off-road rate for your fleet
- You're preparing your BAS and need to calculate the label 7D amount based on eligible litres acquired during the period
- You want to compare fuel tax credit rates across different fuel types (diesel, petrol, LPG) and usage categories
Key concepts
- Fuel excise
- A tax charged by the Australian Government on fuel at production or import. It is built into the price paid for fuel. The applicable rate depends on the fuel and date, and the fuel tax credit scheme refunds some or all of it for eligible business use.
- Road user charge
- The charge reflected in the lower credit for heavy vehicles over 4.5t GVM travelling on public roads. From 1 July to 2 August 2026, the liquid-fuel on-road credit is 20.2c/L versus 36.6c/L for eligible other business use.
- Heavy vehicle (over 4.5t GVM)
- Vehicles with a gross vehicle mass exceeding 4.5 tonnes as shown on the compliance plate. Examples: trucks, semi-trailers, buses, road trains. Heavy vehicles on public roads receive a reduced credit rate (excise minus road user charge). The same vehicle used off-road (e.g., on a mine site) receives the full excise rate.
- Eligible business use
- Fuel must be acquired and used in carrying on your business and must meet the scheme's eligibility rules. Fuel for private use and fuel used by light vehicles on public roads is generally not eligible. Mixed use must be apportioned using records that support the claim.
Worked example — Fuel acquired from 1 July to 2 August 2026
Greg runs a farming and transport business. He acquires diesel during the 1 July to 2 August 2026 rate period for on-road trucks, off-road farm machinery and a light vehicle:
| Vehicle / equipment | Use | Litres | Credit rate (c/L) | Credit |
|---|---|---|---|---|
| Kenworth truck (12t GVM) | On-road delivery | 8,500 | 20.2 | $1,717.00 |
| Isuzu truck (8t GVM) | On-road delivery | 4,200 | 20.2 | $848.40 |
| John Deere tractor | Off-road (farm) | 3,100 | 36.6 | $1,134.60 |
| CAT excavator | Off-road (farm) | 1,800 | 36.6 | $658.80 |
| Diesel generator | Stationary (shed) | 600 | 36.6 | $219.60 |
| Hilux ute (under 4.5t) | Public-road travel | 1,400 | Not eligible | $0.00 |
| Summary | Amount |
|---|---|
| Total diesel purchased | 19,600 litres |
| Eligible on-road heavy vehicle credits | $2,565.40 |
| Eligible off-road / equipment credits | $2,013.00 |
| Total fuel tax credit (BAS label 7D) | $4,578.40 |
The Hilux fuel is excluded because light-vehicle use on public roads is generally ineligible. The trucks use the published heavy-vehicle on-road rate; the farm machinery and generator use the other-business-use rate.