Report and pay additional security when tax rates change

If you purchase fuel in B.C. for resale, you must pay security to your supplier equal to the tax that would have been collected if the fuel was sold to an end purchaser. 

When the carbon tax or motor fuel tax rate changes, you must complete an inventory return to report the amount of security-paid fuel you own for resale purposes as of the end of day that immediately precedes the effective date of the tax rate change.

For example, for tax rate changes effective April 1, you must determine your fuel inventory as of the end of day March 31. You must pay additional security equal to the difference between the old and new tax rates, multiplied by the volume of security-paid fuel in your inventory.

The requirement to file inventory returns and pay additional security applies to all deputy collectors and retail dealers. If you purchase fuel in B.C. for resale and paid or will be paying security to your supplier, you are considered a deputy collector or retail dealer for that fuel. 

This information does not apply to natural gas sellers.

On this page

• Fuel inventory
• Carbon tax inventory return

Fuel inventory

You must take inventory of your fuel as of the end of day that immediately precedes the effective date of the tax rate change. For example, if a tax rate change is effective April 1, you must take inventory at the end of the day on March 31.

To take inventory, you must determine the amount of security-paid fuel you own, or are deemed to own, for resale in your inventory on which you have paid security or are required to pay security.

You’re deemed to own fuel as of the end of the day that immediately precedes the effective date of the tax rate change if:

• You entered into an agreement to purchase fuel and the agreement provides that you own the fuel as of the end of that day,
• You’ve not received delivery of the fuel before that time, and
• You‘ve not entered into an agreement with another person that provides that the other person owns the fuel as of the end of that day

For a carbon tax rate change, if you’re a retail dealer, you’re also deemed to own fuel at the end of the day that immediately precedes the effective date of the tax rate change if:

• You entered into an agreement to sell fuel to an end purchaser, and
• The end purchaser has not received delivery of the fuel as of the end of that day

Carbon tax inventory return

To report your security-paid fuel inventory and pay the additional security owed, you must file a Carbon Tax Inventory Return in your Carbon Inventory (CIV) account using eTaxBC. Your inventory return calculates the amount of additional security due based on the security-paid fuel inventory you report.

If you received a CIV inventory requirement letter, but you do not have an eTaxBC logon, you can use the letter ID to enrol for access to eTaxBC. If you do not have a CIV account or did not receive a letter, please contact us at FuelTax@gov.bc.ca

You do not need to enrol again if you previously added your CIV account to your eTaxBC logon.

Don’t have an eTaxBC logon? Enrol now and learn more about eTaxBC.

File and pay on time

Your inventory return and payment must be received on or before the due date to be considered on time.

Your inventory return and payment are considered on time if they are posted to eTaxBC and the funds are negotiable by 11:59 pm (Pacific Time) on the due date. You must file a nil return on time even if you have no inventory to report.

Although you must file your inventory return using eTaxBC, you can pay using other methods such as by cheque, electronic funds transfer (EFT) or bill payment service through your bank. Find out more about all payment methods on our report and pay page and make sure you understand the steps you must take to pay on time.

If you file and pay on time, you’re entitled to an inventory allowance of $250 if your fuel inventory and the capacity to store fuel is at least 1,000 litres of fuel. You are not eligible for the inventory allowance if you file a nil return.

If you do not file or pay by the due date, we may take further action such as applying a penalty equal to the security you should have paid or issuing an assessment for the estimated security owing.