Fuel charge relief
In certain circumstances, you may be able to benefit from partial or full relief of the fuel charge at the time of delivery if you provide an exemption certificate to the person who delivers the fuel to you.
What is an exemption certificate
An exemption certificate is a document that certain persons that have fuel delivered to them must provide to the person delivering the fuel. This certificate permits the delivery of the fuel in a proposed listed province without having the fuel charge applied at that time.
Specifically when a person delivers fuel to you, an exemption certificate only applies in respect of the delivery if it is made in prescribed form containing prescribed information determined by the CRA and includes a declaration by the person that the person is one of the following:
- a registered distributor, a registered specified air carrier, a registered specified marine carrier or a registered specified rail carrier, for that type of fuel
- a registered emitter and that the fuel is for use at its covered facility
- a registered user of fuel for that type of fuel and that the fuel is for use in a non-covered activity
- a farmer and all of the following conditions are met:
- the fuel is delivered to a farm
- the fuel is for use exclusively in the operation of eligible farming machinery or of an auxiliary component of eligible farming machinery
- all or substantially all of the fuel is for use in the course of eligible farming activities
- a fisher and all of the following conditions are met:
- the fuel is for use exclusively in the operation of an eligible fishing vessel
- all or substantially all of the fuel is for use in the course of eligible fishing activities
The Government of Canada has also proposed to extend additional relief through the use of an exemption certificate when a person delivers light fuel oil to a remote power plant operator that generates electricity for remote communities. It is also proposed that partial relief (80%) would be extended when a person delivers natural gas or propane to a greenhouse operator that provides an exemption certificate.
Remote community means a geographic area that is neither serviced by an electrical distribution network that is under the jurisdiction of the North American Electric Reliability Corporation nor a natural gas distribution system.
How to fill out an exemption certificate
If you are eligible to provide an exemption certificate, you must fill out one of the following forms:
- Form L401, Fuel Charge Exemption Certificate for Registered Distributors
- Form L401-1, Fuel Charge Exemption Certificate for Registered Emitters or Users of Fuel
- Form L401-2, Fuel Charge Exemption Certificate for Registered Specified Carriers (if you are a registered specified air carrier, a registered specified marine carrier, or a registered specified rail carrier)
- Form L402, Fuel Charge Exemption Certificate for Farmers
- Form L403, Fuel Charge Exemption Certificate for Fishers
- Form L404, Fuel Charge Exemption Certificate for Greenhouse Operators
- Form L405, Fuel Charge Exemption Certificate for Remote Power Plant Operators
A fuel charge exemption certificate does not have an expiry date.
Once you fill out the exemption certificate, you must sign the exemption certificate and provide the original to the person who delivers the fuel to you. You can use the exemption certificate for later deliveries made by the same person. If you have already completed, signed and provided an exemption certificate to your suppliers, you don't need to complete another one unless:
- your supplier is requesting that you complete and provide a new exemption certificate since the CRA has improved the exemption certificates to include the fuel types that may be delivered to each exempt group and some suppliers may request that you use the most up to date version of the exemption certificate (the CRA does not send correspondence confirming the addition or removal of fuel types on your account)
- you are registering additional covered facilities as part of the opt-in or aggregate policies under Part 2 of the Act and you are making an application as an emitter for those new facilities
- you are registering covered facilities that operate in Alberta, where a statement under Part 2 is necessary and you are making an application as an emitter for those facilities
Keep a copy of this exemption certificate in your records. Do not send the exemption certificate to the CRA.
The Fuel Charge Registry tool found in My Business Account can be used to confirm the status and registration type of a fuel charge account.
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