Effective 01 April 2015 EXCISE EXTERNAL STANDARD MANAGE DIESEL REFUND CALCULATIONS
TABLE OF CONTENTS 1 SUMMARY OF MAIN POINTS 3 2 STANDARD 3 2.1 Example 1 (on land) tax period 6 monthly 3 2.2 Example 2 (offshore) tax period 2 monthly 4 2.3 Example 3 (electricity generating plants) tax period monthly 4 2.4 Example 4 (rail and certain harbour vessels) tax period 2 monthly 5 3 RELATED INFORMATION 5 3.1 Legislation 5 3.2 Cross References 5 3.3 Quality Records 5 4 DEFINITIONS AND ACRONYMS 6 5 DOCUMENT MANAGEMENT 6 Revision: 11 Page 2 of 6
1 SUMMARY OF MAIN POINTS a) This standard applies to Diesel Refund Registrants claiming a refund in terms of rebate item 670.04 of Schedule 6 to the Customs and Excise Act, Act No. 91 of 1964 (the Act) 2 STANDARD a) The general fuel levy increases by 30.5c per litre and the Road Accident Fund (RAF) levy increases by 50.0c per litre respectively on 1 April 2015. i) Fuel levy = Increases from 209.5c/l to 240.0c/l; and ii) RAF = Increases from 104.0c/l to 154.0c/l. b) The diesel refund in respect of on-land primary sector beneficiaries is 40% of the general fuel levy of 240.0c/l which equals 96.0c/l of the qualifying 80% of diesel consumption. USAGE TYPES PREVIOUS NEW On Land (Farming, Mining & Forestry) 187.8c/l 250.0c/l Electricity Generation Plants 313.5c/l 394.0c/l Offshore (Commercial fishing, Coastwise Shipping, Offshore Mining & NSRI) 313.5c/l 394.0c/l Rail & Harbour Services 104.0c/l 154.0c/l c) Where the implementation date of the new rates for RAF levy and fuel levy falls within the tax period, a factor has been determined on which a vendor must recalculate total non-eligible and eligible litres to determine the correct litres to be entered on the VAT 201 return. d) The prescribed factor per usage type is as follows: On Land 0.75120 Electricity Generation Plants 0.79569 Offshore 0.79569 Rail & Harbour Services 0.67532 e) The VAT vendor must recalculate total non-eligible and eligible litres purchased up to and on 31 March 2015; by using the factor (shown above) to reduce these litres to enable them to use the new rate when, calculating the diesel refund. f) Examples of the calculations are shown below: 2.1 Example 1 (on land) tax period 6 monthly 08/2015 Invoices to 31/03/2015 @ 187.8c/l Invoices from 01/04/2015 @ 250.0c/l (01 March to 31 August) 80% of Eligible Litres 80 000.00 80 000.00 Amount Refundable R 150 240.00 R 200 000.00 TOTAL REFUNDABLE R 150 240.00 + R 200 000.00 = R 350 240.00 a) Correction of litres purchased until 31 March 2015: Total litres times factor equals recalculated 102 000 litres x 0.75120 = 76 622 litres 2 000 litres x 0.75120 = 1 502 litres Recalculated eligible 76 622 litres - 1 502 litres = 75 120 litres Revision: 11 Page 3 of 6
Total litres 76 622 (Recalculated) + 102 000 (litres from 01/04/15) = 178 622 Non-eligible litres 1 502 (Recalculated) + 2 000 (litres from 01/04/15) = 3 502 Eligible litres 75 120 (Recalculated) + 100 000 (litres from 01/04/15) = 175 120 80% of eligible litres 60 096 (Recalculated) + 80 000 (litres from 01/04/15) = 140 096 i) Amount refundable 140 096 (litres) x 250.0c/l = R 350 240.00 2.2 Example 2 (offshore) tax period 2 monthly 04/2015 Invoices to 31/03/2015 @ 313.5c/l Invoices from 01/04/2015 @ 394.0c/l (March and April) Amount Refundable R 313 500.00 R 394 000.00 TOTAL REFUNDABLE R 313 500.00 + R 394 000.00 = R 707 500.00 a) Correction of litres purchased until 31/03/2015 Total litres times factor equals recalculated 102 000 litres x 0.79569 = 81 160 litres 2 000 litres x 0.79569 = 1 591 litres Recalculated eligible 81 160 litres - 1 591 litres = 79 569 litres Total litres 81 160 (Recalculated) + 102 000 (litres from 01/04/15) = 183 160 Non-eligible litres 1 591 (Recalculated) + 2 000 (litres from 01/04/15) = 3 591 Eligible litres 79 569 (Recalculated) + 100 000 (litres from 01/04/15) = 179 569 ii) Amount refundable 179 569 (litres) x 394.0c/l = R 707 501.86 2.3 Example 3 (electricity generating plants) tax period monthly 04/2015 (April) Invoices to 31/03/2015 @ 313.5c/l Invoices from 01/04/2015 @ 394.0c/l Amount Refundable R 313 500.00 R 394 000.00 TOTAL REFUNDABLE R 313 500.00 + R 394 000.00 = R 707 500.00 a) Correction of litres purchased until 31/03/2015. Total litres times factor equals recalculated 102 000 litres x 0.79569 = 81 160 litres 2 000 litres x 0.79569 = 1 591 litres Recalculated eligible 81 160 litres - 1 591 litres = 79 569 litres Revision: 11 Page 4 of 6
Total litres 81 160 (Recalculated) + 102 000 (litres from 01/04/15) = 183 160 Non-eligible litres 1 591 (Recalculated) + 2 000 (litres from 01/04/15) = 3 591 Eligible litres 79 569 (Recalculated) + 100 000 (litres from 01/04/15) = 179 569 ii) Amount refundable 179 569 (litres) x 394.0c/l = R 707 501.86 2.4 Example 4 (rail and certain harbour vessels) tax period 2 monthly 04/2015 (March and April) Invoices to 31/03/2015 @ 104.0c/l Invoices from 01/04/2015 @ 154.0c/l Amount Refundable R 104 000.00 R 154 000.00 TOTAL REFUNDABLE R 104 000.00 + R 154 000.00 = R 258 000.00 a) Correction of litres purchased until 31/03/2015 Total litres times factor equals recalculated 102 000 litres x 0.67532 = 68 883 litres 2 000 litres x 0.67532 = 1 351 litres Recalculated eligible 68 883 litres - 1 351 litres = 67 532 litres Total litres 68 883 (Recalculated) + 102 000 (litres from 01/04/15) = 170 883 Non-eligible litres 1 351 (Recalculated) + 2 000 (litres from 01/04/15) = 3 351 Eligible litres 67 532 (Recalculated) + 100 000 (litres from 01/04/15) = 167 532 ii) Amount refundable 167 532 (litres) x 154.0 c/l = R 257 999.28 3 RELATED INFORMATION 3.1 Legislation TYPE OF REFERENCE Legislation and Rules administered by SARS: Other Legislation: International Instruments: REFERENCE Customs and Excise Act No. 91 of 1964: Section 75 Customs and Excise Rules: None None None 3.2 Cross References DOCUMENT # QMS-01 DOCUMENT TITLE Quality Management System Manual 3.3 Quality Records Number VAT 201 Title Value Added Tax Return Revision: 11 Page 5 of 6
4 DEFINITIONS AND ACRONYMS c/l Item 670.04 RAF SARS Schedule 6 VAT Cents per litre Distillate fuel purchased for use and used for the purposes specified in, and subject to compliance with Note 6 to Schedule No. 6 Road Accident Fund South African Revenue Service Rebates and Refunds of excise duty and fuel levy Value Added Tax 5 DOCUMENT MANAGEMENT Owner Detail of change from previous revision Template number and revision Executive: Process Solutions Customs & Support Services In his budget speech on 25 February 2015 the Minister announced that the fuel levy and RAF levy is increased by 30.5c and 50.0c respectively with effect from 1 April 2015; and The Directive has been changed to a. ECS-TM-03 - Rev 8 Revision: 11 Page 6 of 6