Staying cool made affordable with tax free air conditioning

Good news for truck drivers, staying cool on long journeys during those scorching hot Summer months has just been made easier as the fuel used in the truck sleeper cab air conditioners is now tax free. The move is thanks to the lobbying done by the Australian Trucking Association.

According to an article on Trucking website, tax office ruling FTR 2008/1A4 was issued this month and allows trucking operators to claim back 100 per cent of the tax on the fuel used in these cab air conditioners which as a result could save trucking business owners up to $300 a year, per truck.

A sleeper cab air conditioner is a small air conditioning unit that cools the sleeper cab of a long distance truck while it is stationary, the truck engine is off and the driver is resting. It is typically powered by a small auxiliary engine that draws fuel from a truck’s main fuel tanks.

The article also described how the Chief Executive officer of the ATA, Stuart St Clair as well as the tax office agreed that the fuel used in the sleep cab air conditioners was not for travelling but was used to keep the cab cool while the truck is stationary, a key point in determining whether or not it should be taxed as a road user charge.

The post on goes on to explain:

 “The ATA argued in February that the fuel used in a sleeper cab air conditioner is used to cool the sleeper cab while the truck is stationary, its engine is off and the driver is resting,” Mr St Clair said.

“We pointed out that it is not used ‘for travelling,’ which is now the crucial test for deciding if the fuel used in a truck is subject to the road user charge.

“In its ruling, the tax office has come down in support of the ATA’s position. As a result, trucking businesses can now claim back all the tax on the fuel used in these air conditioners: a fuel tax credit of 38.143 cents per litre.

“In contrast, trucking businesses can only claim 12.643 cents per litre in fuel tax credits on the fuel they use ‘for travelling.’ This rate is expected to fall even further on 1 July 2013, due to the yearly adjustment of the road user charge.”

Mr St Clair said the ruling would particularly benefit long distance owner drivers.

“Owner drivers often spend more nights in their sleeper cabs than they do at home. I’m very pleased we’ve been able to make sure they won’t be taxed to stay cool and get a good night’s sleep,” he said.

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Trucking businesses need to ensure that they keep record which show how they worked out the amount of fuel used in their sleeper cab air conditioners if they want a fuel tax credit. They have been advised to speak to their accountants or tax agents about the appropriate, reliable measures that can be used to work this out and keep records about fuel use.

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