Maximising fuel tax credits in Australia for businesses and farmers

Fuel is one of the largest ongoing costs for Australian businesses. To help ease this burden, the Australian Taxation Office (ATO) provides Fuel Tax Credits in Australia, a rebate on the fuel tax (excise or customs duty) included in the price of fuel.

At PKF, we often see businesses and farmers missing out on the full value of their claims. The rules can be complex, rates change regularly, and many businesses and primary producers don’t realise how much of their fuel usage is eligible. By working closely with your PKF Tamworth tax consultants, you can ensure you’re claiming the correct credits and staying compliant with the ATO.

What are Fuel Tax Credits?

Fuel Tax Credits in Australia provide a rebate for the fuel tax paid at the pump. They apply to fuel used in:

• Heavy vehicles on public roads (over 4.5 tonnes GVM
• Plant and machinery such as excavators, loaders, forklifts, and harvesters
• Equipment including generators, pumps, or chainsaws
• Light vehicles used off public roads, such as in farming, mining, or construction

If your business or farm uses fuel for more than just road transport, you may be entitled to more credits than you realise.

Common mistakes businesses and farmers make when claiming Fuel Tax Credits

Many businesses and New England North West farmers leave money on the table because of:

• Using outdated rates: FTC rates change every February and August in line with ATO excise indexation.
• Not separating eligible uses: Different fuel uses attract different credit rates (e.g., refrigeration units vs vehicle movement).
• Poor record keeping: Without strong evidence, many businesses and primary producers under-claim.
• Assuming smaller claims aren’t worth it: Even modest claims can add up substantially.

Fuel Tax Credits for primary producers and farmers in New England North West

Primary Producers Fuel Tax Credits are particularly valuable for farmers in New South Wales’ New England North West region. Agriculture often involves high volumes of fuel used off public roads in machinery and equipment, which generally qualifies for higher FTC rates.

The fuel-powered farm work that counts towards tax credits

Farmers can typically claim Fuel Tax Credits on fuel used for:

• Tractors and harvesters in crop production
• Quads, motorbikes, and light vehicles used off public roads
• Stationary equipment such as pumps, augers, and generators
• Earthmoving machinery used for land preparation or dam construction
• Horticulture, viticulture, forestry, and aquaculture operations

"If it moves your machinery or powers your pumps, it probably earns a Fuel Tax Credit."

How PKF Tamworth tax consultants drive accurate and compliant Fuel Tax Credit claims  

Our PKF Tamworth tax consultants work with primary producers and businesses to identify all eligible fuel activities to capture the full value of claims, separating on-road and off-road fuel usage, confirm the latest ATO rates, and improve record-keeping systems to ensure claims are accurate and compliant.

Jamie Donovan says, “A primary producer client of mine in the New England region had been claiming all their fuel tax credits at the on-road rate. In reality, their fuel use was split between trucks for grain delivery and cattle cartage, as well as on-farm vehicles and machinery. The client, who was relatively new to the PKF office, hadn’t been advised by their previous accountant that they were entitled to claim machinery and on-farm vehicle fuel at the higher rate.

We reviewed their records, recalculated their fuel tax credit claims, and amended the relevant Business Activity Statements within the allowable amendment period. This resulted in a refund and a valuable cash injection into the client’s farm working account.”  

For New England North West farmers, these credits can return substantial cash flow that can be reinvested into operations, equipment, and growth.

Thousands of dollars in rebates come from accurate Fuel Tax Credit claims

To ensure you claim correctly:

• Confirm current Fuel Tax Credits in Australia rates with your PKF tax consultant
• Map fuel use across all eligible activities
• Separate on-road and off-road fuel use and remember, "If it fuels your farm, it should fuel your claim too.
• Maintain strong record-keeping systems
• Regularly review claims to stay compliant

Stop losing money at the fuel pump

Fuel Tax Credits in Australia are a strategic cash flow tool. For sectors like agriculture, construction, mining, and transport, accurate claims can return thousands or even hundreds of thousands of dollars annually.

At PKF, our PKF Tamworth tax consultants help businesses and New England North West farmers navigate the complexities of tax compliance. If you’re not sure whether you’re claiming everything you’re entitled to, it’s time to propel your future and to contact a PKF tax consultant.