The late release of the December consumer price index by the Australian Bureau of Statistics has delayed the fuel tax credit rate change, which may lead to complications for clients if tax professionals are not on the ball.
‘Watch very closely’: mid-tier flags fuel tax credit change delay
CPI for December 2017 was published by the ABS on 31 January 2018, leading to fuel tax credit rates to be indexed on 5 February, instead of the historical 1 February date. Fuel tax credit rates are indexed twice a year, in February and August, in line with the CPI.
Speaking to Accountants Daily, Pitcher Partners customs, fuel tax and international trade director Darryl Daisley said claimants would have to be aware of this change, which may lead to administrative issues.
“Most of the fuel tax credit claimants over the last couple of years have been used to the change occurring on either 1 August or 1 February and now this year, they would have expected 1 February but it's now 5 February,” said Mr Daisley.
“It's just an administrative thing this year by the looks of it, the ABS data which feeds into the CPI rate, they didn't get warning of greater than five days which then meant that it must happen on the fifth day after the publication date.
“It just shows you that claimants have to watch very closely for the rates and the dates of the change because it is the first time it's been not 1 February for many years, and because the way the Fuel Tax Act works, it all ties into date of acquisition of the fuel, as to what rate is then applied to against that fuel.”
Mr Daisley said that while the date change itself was not an added layer of complexity, the fuel scheme was already complex enough.
“Where we're seeing clients coming unstuck is not getting the right rate for that particular fuel, not identifying and correctly allocating the right portion to either an off-road or on-road environment and then you have to look at when you bought that fuel,” Mr Daisley said.
“The way the scheme is structured is that the small- to medium-sized to large guys, the tax office's expectation is that they would like everyone to claim monthly because it goes onto the BAS, and there is a healthy portion of clients who don't get in their claims monthly and may take a number of months before they work their claim in.
“So it's just an added complexity of getting the right dates, the rates, the type of fuel, you may need to apportion, and some of the fuel may be ineligible for a fuel tax credit depending on your mix of your fleet and the type of vehicles that you use.”