Tax and Revenue Administration Fuel Tax Act Information Circular FT-5

FT-5/ March 2007

ALBERTA FUEL TAX ACT INFORMATION CIRCULAR - MARKING FUEL

(Effective April 1, 2007)

NOTE: This Information Circular is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this Information Circular and governing legislation, the legislation takes precedence.

MARKING FUEL

This Information Circular explains:

• What is Marked Fuel
• Marking Fuel
• Purchase of Fuel Dye
• Accidental Mixing of Clear and Marked Fuel

WHAT IS MARKED FUEL

1. Marked fuel is fuel coloured to a concentration of 14 parts per million of red dye and is sold exempt of tax to eligible consumers.

MARKING FUEL

2. Persons wishing to mark fuel must apply for registration by sending a letter to Alberta Finance and Enterprise, Tax and Revenue Administration (TRA) , requesting registration to mark fuel. Additional information may be requested by TRA to determine the applicant's eligibility to mark fuel.
   
   
3. Where TRA approves the application, a letter sent to the applicant by TRA will confirm the registration and specify the locations where fuel can be marked. Persons authorized to mark fuel must do so at a terminal, unless TRA approves another location. Alternate dye points may include:
   
   
   • on-truck marker injection systems, if the necessary controls are in place; or
   • cardlocks, if the necessary controls are in place.

TRA may approve these facilities if a dye injection system with appropriate security features is used.

PURCHASE OF FUEL DYE

4. Dye used to mark fuel must be purchased from companies authorized by TRA to supply dye. A list of approved fuel dye suppliers is available on TRA's website.

ACCIDENTAL MIXING OF CLEAR AND MARKED FUEL

5. If a person, other than a person registered to mark fuel or a consumer, accidentally mixes clear and marked fuel, the person should immediately turn off the valves leading to and from the affected tanks. The person must notify TRA of the product mix and take any action that TRA directs. Fuel should not be sold or removed from tanks where mixing has occurred until the fuel has been properly dyed to the specifications for marked fuel. Failure to follow the correct procedures could result in the fuel seller being liable for fuel tax on fuel that is not properly rebranded.
   
   
6. Fuel sellers should keep on hand a copy of TRA's "Rebrand Notification" (form AT376), available from TRA at the address shown on the bottom of the first page of this circular. The form contains instructions for fuel sellers to account for all fuel involved in the mix , associated fuel tax , and the volume of mixed fuel which must be marked to a concentration of 14 parts per million.
   
   
7. Fuel sellers who own their own fuel report the volume of mixed fuel that was hand dyed on the "Fuel Reseller – Fuel Tax Adjustments” (form AT372) and the “Rebrand Notification” (form AT376). This will enable them to obtain refunds of fuel tax paid on the portions of product mixes that were clear fuel.
   
   
8. Fuel sellers who do not own the fuel should complete and forward the “Rebrand Notification” (form AT376) to their full direct remitters to report the product mix on the Generic Fuel Tax Return.