Issue
Under section 78AE of the Excise Act 1901 or section 164AD of the Customs Act 1901 , may the Commissioner amend a diesel fuel rebate assessment in relation to a purchase of fuel where the client has already claimed a rebate in respect of a portion of the fuel purchase under one category and now wishes to claim another portion of the same fuel purchase under a different category?
Decision
Yes. The Commissioner may amend a diesel fuel rebate assessment in relation to a purchase of fuel where the client has already claimed a rebate in respect of a portion of the fuel purchase under one category and now wishes to claim another portion of the same fuel purchase under a different category. However, the Commissioner may only amend an assessment within five years of the client's original application.
Facts
A client has lodged diesel fuel rebate claims in relation to diesel fuel they have purchased. They have only claimed the diesel fuel rebate for that portion of diesel fuel purchased that was eligible for a diesel fuel rebate under one category of rebate.
The client has become aware that they are entitled to claim a rebate in respect of an additional portion of the same fuel purchase under a different category.
The client wishes to amend their diesel fuel rebate assessments in order to claim a rebate in respect of this additional portion.
Reasons for Decision
The following reasons are based on the legislation contained in the Excise Act. The Customs Act contains corresponding provisions, so the rationale and conclusions expressed in regard to the Excise Act are equally applicable to the Customs Act.
Under subsection 78A(1) of the Excise Act, a person is entitled to a diesel fuel rebate for fuel they purchase for use in eligible activities.
Under subsection 78A(4A) of the Excise Act, rebate on a diesel fuel rebate application is only payable in respect of diesel fuel purchased within three years before the application is received. The diesel fuel rebate application can relate to any purchases within this 3 year period. It does not relate to any specific claim period.
Under subsection 78A(4B) of the Excise Act, the Commissioner must give a written notice of assessment to a person who has applied for and is to be paid a rebate.
Subsections 78AE of the Excise Act allows the Commissioner, in certain circumstances, to amend the assessment of a person's rebate entitlement within five years of the client making a diesel fuel rebate application.
It follows that section 78AE of the Excise Act will only apply in relation to diesel fuel purchases for which an application has been lodged and an assessment made by the Commissioner under subsection 78A(4B) of the Excise Act.
One basis for amending an assessment that is specified in section 78AE of the Excise Act is where the applicant notifies a taxation officer in writing of an error or errors in the application before the applicant is notified by the Commissioner of the commencement of an audit.
While many of the grounds for amendment in section 78AE of the Excise Act would appear to be targeted at providing the Commissioner with the opportunity to reduce a client's entitlement, the possibility of correcting underpayments of rebate is clearly envisaged, as evidenced by subsection 78AE(8) of the Excise Act which states that prompt payment must be made to the client where the amended assessment results in them having a greater entitlement as a result of an amendment.
In this case, the client has claimed diesel fuel rebate for a proportion of particular diesel fuel purchases, and provided invoices with the relevant claims. The client has now advised that rebate is payable for another portion of the same fuel under a different rebate category.
An assessment of rebate has previously been made in respect of the diesel fuel purchases and the client has notified the Commissioner of an error in those previous assessments. Accordingly, the Commissioner may amend the assessments, subject to doing so within five years of the lodgement of the original applications.