Utah Administrative Code
The Utah Administrative Code is the body of all effective administrative rules as compiled and organized by the Division of Administrative Rules (see Subsection 63G-3-102(5); see also Sections 63G-3-701 and 702).
NOTE: For a list of rules that have been made effective since January 1, 2020, please see the codification segue page.
NOTE TO RULEFILING AGENCIES: Use the RTF version for submitting rule changes.
R865. Tax Commission, Auditing.
Rule R865-4D. Special Fuel Tax.
As in effect on January 1, 2020
Table of Contents
- R865-4D-1. Utah Special Fuel Tax Regulation Pursuant to Utah Code Ann. Section 59-13-102.
- R865-4D-2. Refund Procedures for Special Fuel Used Off-Highway or to Operate a Power Take-Off Unit, and Sales Tax Liability Pursuant to Utah Code Ann. Section 59-13-301.
- R865-4D-6. Invoices Pursuant to Utah Code Ann. Sections 59-13-301 and 59-13-313.
- R865-4D-18. Maintenance of Records Pursuant to Utah Code Ann. Sections 59-13-305(1) and 59-13-312.
- R865-4D-19. Refund of Special Fuel Taxes Paid by Government Entities Pursuant to Utah Code Ann. Section 59-13-301.
- R865-4D-20. Exemption or Refund for Exported Undyed Diesel Fuel Pursuant to Utah Code Ann. Section 59-13-301.
- R865-4D-21. Consistent Basis for Diesel Fuel Reporting Pursuant to Utah Code Ann. Sections 59-13-301 and 59-13-307.
- R865-4D-22. Reduction in Special Fuel Tax for Suppliers Subject to Navajo Nation Fuel Tax Pursuant to Utah Code Ann. Section 59-13-301.
- R865-4D-23. State Participation in the International Fuel Tax Agreement Pursuant to Utah Code Ann. Section 59-13-501.
- R865-4D-24. Special Fuel Tax License Pursuant to Utah Code Ann. Section 59-13-302.
- Date of Enactment or Last Substantive Amendment
- Notice of Continuation
- Authorizing, Implemented, or Interpreted Law
A. Motor vehicle means and includes every self-propelled vehicle operated or suitable for operation on the highways of the state which is designed for carrying passengers or cargo; but does not include vehicles operating on stationary rails or tracks, or implements of husbandry not operating on the highways.
B. User means any person using special fuel for the propulsion of a motor vehicle on the highways of the state, including:
1. interstate operators of trucks and buses,
2. intrastate operators of trucks and buses, and
3. contractors using special fuel in self-propelled vehicles for carrying of passengers or cargo.
R865-4D-2. Refund Procedures for Special Fuel Used Off-Highway or to Operate a Power Take-Off Unit, and Sales Tax Liability Pursuant to Utah Code Ann. Section 59-13-301.
(1)(a) "Off-highway," for purposes of determining whether special fuel is used in a vehicle off-highway, means every way or place, of whatever nature, that is not generally open to the use of the public for the purpose of vehicular travel.
(b) "Off-highway" does not include:
(i) a parking lot that the public may use; or
(ii) the curbside of a highway.
(2) Fuel used in a vehicle off-highway is calculated by taking off-highway miles divided by the average number of miles per gallon. Any other method of calculating special fuel used off-highway must be supported by on-board computer information or other information that shows the number of gallons used off-highway with accuracy equal or comparable to on-board computers.
(3) Where a power take-off unit is driven by the main engine of the vehicle and used to operate auxiliary equipment, a quantity, as enumerated below, of the total special fuel delivered into the service tank of the vehicle shall be deemed to be used to operate the power take-off unit. The allowances for power take-off units are as follows:
(a) concrete mixer trucks - 20 percent;
(b) garbage trucks with trash compactor - 20 percent;
(c) vehicles with powered pumps, conveyors or other loading or unloading devices may be individually negotiated but shall not exceed:
(i) 3/4 gallon per 1000 gallons pumped; or
(ii) 3/4 gallon per 6000 pounds of commodities, such as coal, grain, and potatoes, loaded or unloaded.
(d) Any other method of calculating the amount of special fuel used to operate a power take-off unit must be supported by documentation and records, including on-board computer printouts or other logs showing daily power take-off activity, that establish the actual amount of power take-off activity and fuel consumption.
(4) Allowances provided for in Subsections (2) and (3) will be recognized only if adequate records are maintained to support the amount claimed.
(5) In the case of users filing form TC-922, Fuel Tax Return For International Fuel Tax Agreement (IFTA) And Special Fuel User Tax, or form TC-922C, Refund of Tax Paid on Exempt Fuel for Non-Utah Based Carriers, the allowance provided for in Subsection will be refunded to the extent total gallons allocated to Utah through IFTA exceed the actual taxable gallons used in Utah, except that in no case will refunds be allowed for power take-off use that does not occur in Utah.
(6) Special fuel used on-highway for the purpose of idling a vehicle does not qualify for a refund on special fuel tax paid since the fuel is used in the operation of a motor vehicle.
(7) The following documentation must accompany a refund request for special fuel tax paid on special fuel used in a vehicle off-highway:
(a) evidence that clearly indicates that the special fuel was used in a vehicle off-highway;
(b)(i) the specific address of the off-highway use with a description that is adequate to verify that the location is off-highway; or
(ii) if a specific address is not available, a description of the off-highway location that is adequate to verify that the location is off-highway;
(c) a description of how the vehicle was used off-highway;
(d)(i) the date of the off-highway use; and
(ii) if the claimed use is idling while off-highway, the amount of time the vehicle was idling at that location;
(e) the amount of fuel the vehicle used off-highway; and
(f) the make and model, weight, and miles per gallon of the vehicle used off-highway.
(8) Special fuel that is purchased exempt from the special fuel tax or for which the special fuel tax has been refunded is subject to sales and use tax, unless specifically exempted under the sales and use tax statutes.
A. If requested, a retail dealer must issue to a purchaser of special fuel an invoice that indicates the fuel taxes that have been included in the price of purchased fuel. This invoice shall serve as evidence that the special fuel tax has been paid.
B. Invoices must be numbered consecutively, made in duplicate, and contain the following information:
1. name and address of seller;
2. place of sale;
3. date of sale;
4. name and address of purchaser;
5. fuel type;
6. number of gallons sold;
7. unit number or other vehicle identification if delivered into a motor vehicle;
8. type of container delivered into if not a motor vehicle;
9. invoice number; and
10. amount and type of state tax paid on the special fuel, if any.
C. A retail dealer must charge sales tax on diesel fuel that is exempt from special fuel tax unless the retail dealer has received and retains on file a properly completed sales and use tax exemption certificate indicating that the transaction is exempt from sales tax.
D. A retail dealer that sells propane exempt from special fuel tax, but subject to sales tax, must at the time of each sale and delivery keep a record of the exempt sale. This record shall be in the form of an invoice or a log, and shall serve as evidence that the sale is exempt from special fuel tax.
1. If the record is in the form of an invoice, it shall contain the information required under B.
2. If the record is in the form of a log, it shall contain the following information:
a) name and address of the retail dealer;
b) date of sale;
c) amount of propane sold; and
d) purchaser's name.
E. A retail dealer that sells propane or electricity exempt from sales tax shall retain the following information for each exempt sale:
1. the make, year, and license number of the vehicle;
2. the name and address of the purchaser; and
3. the quantity (e.g., number of gallons) sold.
F. A retail dealer is not required to obtain an exemption certificate from a purchaser of dyed diesel fuel indicating that the dyed diesel fuel will be used for purposes other than to operate a motor vehicle upon the highways of the state if the retail dealer complies with the notice requirement under 26 C.F.R. Section 48.4082-2.
G. A retail dealer may not sell dyed diesel fuel exempt from special fuel tax if the retail dealer knows that the fuel will be used to operate a motor vehicle upon the highways of the state.
A. The records and documents maintained pursuant to Section 59-13-312 must substantiate the amount of fuel purchased and the amount of fuel used in the state and claimed on the special fuel report required by Section 59-13-305(1).
B. Every user must maintain detailed mileage records and summaries for fleets traveling in Utah, detailed fuel purchase records, and bulk disbursement records. From this information, an accurate average miles per gallon (mpg) figure can be determined for use in computing fuel tax due. No fuel entering the fuel supply tank of a motor vehicle may be excluded from the mpg computation. Refer to Tax Commission rule R865-4D-2.
C. Individual vehicle mileage records (IVMRs) separating Utah miles from non-Utah miles must be maintained. Utah miles must be separated further into taxable Utah miles and nontaxable Utah miles. An adequate IVMR will contain the following information:
1. starting and ending dates of trip;
2. trip origin and destination;
3. route of travel, beginning and ending odometer or hubometer reading, or both;
4. total trip miles;
5. Utah miles;
6. fuel purchased or drawn from bulk storage for the vehicle; and
7. other appropriate information that identifies the record, such as unit number, fleet number, record number, driver's name, and name of the user or operator of the vehicle.
D. If the user fails to maintain or provide adequate records from which the user's true liability can be determined, the Tax Commission shall, upon giving written notice, estimate the amount of liability due. Such estimate shall take into consideration any or all of the following:
1. any available records maintained and provided by the user;
2. historical filing information;
3. industry data;
4. a flat or standard average mpg figure.
a) The standard average mpg normally applied is four mpg for qualified motor vehicles and six miles per gallon for nonqualified motor vehicles.
E. Section 59-13-312(2) requires that the user be able to support credits claimed for tax-paid fuel with documents showing payment of the Utah special fuel tax. If documents and records showing payment of the Utah special fuel tax are not maintained or are not provided upon request, the credits will be disallowed.
R865-4D-19. Refund of Special Fuel Taxes Paid by Government Entities Pursuant to Utah Code Ann. Section 59-13-301.
(1) Governmental entities entitled to a refund for special fuel taxes paid shall submit a completed Utah Application for Fuel Tax Refund, form TC-116, to the commission.
(2) A governmental entity shall retain the following records for each purchase of special fuel for which a refund of taxes paid is claimed:
(a) name of the government entity making the purchase;
(b) license plate number of the government vehicle for which the special fuel is purchased;
(c) invoice date;
(d) invoice number;
(f) vendor location;
(g) product description;
(h) number of gallons purchased; and
(i) amount of state special fuel tax paid.
(3) Original records supporting the refund claim must be maintained by the government entity for three years following the year of refund.
R865-4D-20. Exemption or Refund for Exported Undyed Diesel Fuel Pursuant to Utah Code Ann. Section 59-13-301.
A. If untaxed undyed diesel fuel is sold by a supplier directly out-of-state or is sold by a supplier to a purchaser that will deliver the fuel directly out-of-state, the fuel may be sold by the supplier exempt from the special fuel tax.
B. If untaxed undyed diesel fuel is sold tax exempt under A., the supplier shall report the fuel sold tax exempt on the export schedule of its special fuel supplier return.
C. If special fuel tax has been paid on undyed diesel fuel that is exported, the exporter may apply to the Tax Commission, on a monthly basis and on the export refund request form provided by the Tax Commission, for a refund of special fuel taxes paid.
D. Original records supporting the exemption or refund claim must be maintained by the entity claiming the exemption or refund for three years following the year of exemption or refund.
R865-4D-21. Consistent Basis for Diesel Fuel Reporting Pursuant to Utah Code Ann. Sections 59-13-301 and 59-13-307.
(a) "Gross gallon" means the United States volumetric gallon with a liquid capacity of 231 cubic inches.
(b) "Net gallon" means the gross metered gallon with temperature correction in volume to 60 degrees Fahrenheit.
(2) All Utah licensed special fuel suppliers shall elect to calculate the tax liability on a consistent and strict gross gallon or net gallon basis. The election must be declared in writing and must be sent to the Tax Commission. The declared basis must be the exclusive basis used for 12 consecutive months. Any supplier failing to make an election will default to the gross gallon basis and must then report and pay the excise tax on that basis. Request for changes in the reporting basis must be submitted in writing and approved by the Tax Commission prior to any change in the reporting basis. Changes in basis may occur only on January 1 and must remain in effect 12 consecutive months.
(3) All invoices, bills of lading, and special fuel tax returns must include both the gross and net gallon amounts. Conversion from gross to net must conform to the ASTM-API-IP Petroleum Measurement Tables.
(4) All transactions, such as purchases, sales, or deductions must be reported on a consistent and exclusive basis. The taxpayer shall not alternate the two methods on any return or during any 12-month period.
(5) This rule shall take effect July 1, 1997.
R865-4D-22. Reduction in Special Fuel Tax for Suppliers Subject to Navajo Nation Fuel Tax Pursuant to Utah Code Ann. Section 59-13-301.
A. The purpose of this rule is to provide procedures for administering the reduction of special fuel tax authorized under Section 59-13-301.
B. The reduction shall be in the form of a refund.
C. The refund shall be available only for special fuel:
1. delivered to a retailer or consumer on the Utah portion of the Navajo Nation; and
2. for which Utah special fuel tax has been paid.
D. The refund shall be available to a special fuel supplier that is licensed as a distributor with the Office of the Navajo Tax Commission.
E. The refund application may be filed on a monthly basis.
F. A completed copy of the Navajo Tax Commission Monthly Fuel Distributor Tax Return, form 900, along with schedules and manifests, must be included with the Utah State Tax Commission Application for Navajo Nation Fuel Tax Refund, form TC-126.
G. Original records supporting the refund claim must be maintained by the supplier for three years following the year of refund. These records include:
1. proof of payment of Utah special fuel tax;
2. proof of payment of Navajo Nation fuel tax; and
3. documentation that the special fuel was delivered to a retailer or consumer on the Utah portion of the Navajo Nation.
R865-4D-23. State Participation in the International Fuel Tax Agreement Pursuant to Utah Code Ann. Section 59-13-501.
A. Pursuant to Section 59-13-501, the commission entered into the International Fuel Tax Agreement ("IFTA") effective January 1, 1990.
B. Participation in IFTA is intended to comply with 49 U.S.C. 31705.
C. This rule incorporates by reference the 2003 edition of the IFTA:
1. Articles of Agreement;
2. Procedures Manual; and
3. Audit Manual.
(1) The holder of a license issued under Section 59-13-302 shall notify the commission:
(a) of any change of address of the business;
(b) of a change of character of the business; or
(c) if the license holder ceases to do business.
(2) The commission may determine that a person has ceased to do business or has changed that person's business address if:
(a) mail is returned as undeliverable as addressed and unable to forward;
(b) the person fails to file four consecutive special fuel tax returns;
(c) the person fails to renew its annual business license with the Department of Commerce; or
(d) the person fails to renew its local business license.
(3) If the requirements of Subsection (2) are met, the commission shall notify the license holder that the license will be considered invalid unless the license holder provides evidence within 15 days that the license should remain valid.
(4) A person may request the commission to reopen a special fuel tax license that has been determined invalid under Subsection (3).
(5) The holder of a license issued under Section 59-13-302 shall be responsible for any special fuel tax, interest, and penalties incurred under that license whether those taxes and fees are incurred during the time the license is valid or invalid.
taxation, fuel, special fuel
August 27, 2015
November 10, 2016
59-13-102; 59-13-301; 59-13-302; 59-13-303; 59-13-304; 59-13-305; 59-13-307; 59-13-312; 59-13-313; 59-13-501
For questions regarding the content or application of rules under Title R865, please contact the promulgating agency (Tax Commission, Auditing). A list of agencies with links to their homepages is available at http://www.utah.gov/government/agencylist.html or from http://www.rules.utah.gov/contact/agencycontacts.htm.