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Refunds for motor fuel tax and carbon tax

Last updated on April 9, 2024

If you overpaid tax or paid tax in error (for example, you qualify but didn't receive an exemption when you purchased the fuel), you may be eligible to receive a refund of the motor fuel tax or carbon tax you paid.

If you are looking for information about the fuel tax refund program for persons with disabilities, visit our fuel tax refund program for persons with disabilities webpage.

Who can claim a refund

Only the person who paid the tax can claim a refund. We consider the person who purchased the fuel (for example, the person named on the invoice) to be the person who paid the tax, regardless of whose funds the purchaser used.

An exception to this rule is when an agent purchases goods or services on behalf of their principal. In these cases, the agent is considered the purchaser and must apply for any refund available. Please contact us if you are unsure if you are in an agent-principal situation.

If the documentation doesn’t name the purchaser but it shows that payment was made using a credit card, debit card or cheque, we will consider the credit card or bank account holder to be the person who paid the tax.

Important: Your application will be rejected if you are not the correct person or business to claim the refund.

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Example 

John is the sole shareholder of the company Logging Inc. John purchased clear diesel for Logging Inc.’s logging truck and paid motor fuel tax at the clear diesel rate. In certain situations, fuel purchased for use off-highway is eligible for a refund of the difference between the clear and coloured tax rates. In this case, the fuel John purchased was for a qualifying use in Logging Inc.’s logging truck. The fuel invoice names John as the purchaser.

Because John is identified as the purchaser, he may apply for a refund. Logging Inc. may not.

 Fuel sellers

As a fuel seller, you may apply for motor fuel tax and/or carbon tax refunds for the difference between the security you pay on your fuel purchases and the security or tax you collect from your customers.

Examples include:

  • Motor fuel and carbon tax refunds for exempt sales to First Nations or diplomats
  • Motor fuel and carbon tax refunds for exempt sales to registered consumers or for exported fuel
  • Motor fuel tax refunds for businesses authorized to colour or re-label fuel and sell at a lower tax rate

If you are registered as a collector and submit tax returns to us, you can claim a refund by deducting the refund amount from the amount of the security due on the return for the same reporting period.

If you are a deputy collector or retail dealer, you can claim a refund by filling out the applicable refund application form. Forms are either available online or at a Service BC Centre near you.

Each refund form will tell you what documentation you may need to include. You can then submit the completed form and your documentation by mail or courier to the address on the form.

The ministry cannot issue refunds of less than $10, or if the security was paid more than four years from the date we receive your refund claim.

If you extend credit to a customer, you may be required to pay the tax due on the sale before you collect the tax or security from your customer. If the customer’s account later becomes uncollectable and is written off as a bad debt, you are eligible for a refund of the amount of tax or security that you paid to the ministry but did not collect from your customer.

Fuel purchasers

In some situations, you need to pay the tax first and meet some conditions to qualify for a refund or partial refund. Examples include:

  • Motor fuel tax and carbon tax refunds for jet fuel used in international flights, unless you have been issued a registered consumer certificate in which case you can receive a point of sale exemption
  • Partial motor fuel tax refunds for clear fuel used off-highway by the logging, mining, and oil and gas industries
  • Partial motor fuel tax refunds for fuel used in stationary engines
  • Carbon tax refunds for fuel used for specific non-energy purposes, unless you have been appointed a registered consumer in which case you can claim a point of sale exemption

You can apply for a refund by filling out the applicable form. Forms are either available online or at a Service BC Centre near you.

Each refund form will tell you what documentation you may need to include. You can then submit the completed form and your documentation by mail or courier to the address on the form.

The ministry cannot issue refunds of less than $10, or if the date you paid tax or security was more than four years ago.

Appealing a disallowed or reduced refund claim

You can appeal a denied or reduced refund claim by writing a letter to the Minister of Finance within 90 days of the date on the letter that notifies you of the denied or reduced refund.

  • For more information on appeals and how to file, see the Appeals page.
Appeals

You may be able to appeal if you disagree with an action we have taken or a decision we have made.

For example, if you are refused to be appointed as a collector, you can appeal  directly to the minister, and if you still disagree, appeal to the courts.

Contact information

Contact us with your questions about the motor fuel tax or carbon tax.

Our hours of operation are Monday through Friday,
8:30 am - 4:30 pm.

Toll Free (within Canada and the U.S.A.):
1-877-388-4440

Phone
1-250-410-0373
Email
CTBTaxQuestions@gov.bc.ca