Users - Nontaxable Uses - Filing Claims for Refund

If you pay tax on diesel fuel and use it in a nontaxable way, you may file a claim for refund using form BOE-770-DU, Diesel Fuel Claim for Refund on Nontaxable Uses.

Before you file

If you are not registered to file claims for refund for nontaxable uses, you must do both of the following before you file your first claim:

Filing frequency

You must file by the latest deadline below:

  • Within three years of the date you bought the fuel, or
  • If the tax was not invoiced at the time of purchase, within six months of the date you received an invoice for the tax

You may file a claim with us either:

  • Once a year for any amount or
  • At the end of any calendar quarter, if your claim is for at least $750

Exceptions

  • Farmers and exempt bus operators may not file claims for refund for tax-paid fuel used in farming or an exempt bus operation. However, if you are a farmer or an exempt bus operator you may file claims for refund for other off-highway uses.
  • Licensed diesel fuel suppliers may claim refunds for tax-paid fuel used in a nontaxable way on their tax returns, form BOE-501-DD.
  • Ultimate vendors and exempt sellers may claim refunds on their regular claim for refund form BOE-770-DV, Diesel Fuel Ultimate Vendor Report/Claim for Refund or BOE-770-DZ, Claim for Refund on Nontaxable Sales and Exports of Diesel Fuel.

Common nontaxable uses

The most common nontaxable uses of tax-paid diesel fuel include operating:

  • Stationary equipment
  • Vessels or watercraft
  • Construction equipment off-highway when it is exempt from DMV registration
  • Other vehicles off-highway
  • Vehicles on highways under the jurisdiction of the U.S. Department of Agriculture (for example, National Forest roads)
  • Auxiliary equipment. Equipment, accessories, or amenities other than equipment used to operate a motor vehicle upon a highway in California, which is operated from the same fuel tank as the motor vehicle, is considered auxiliary equipment. Equipment powered from a separate fuel source or tank that is used to operate the motor vehicle would not be considered auxiliary equipment.

Safe-harbor percentages

  • Auxiliary equipment. Effective April 1, 2016, Regulation 1432, Other Nontaxable Uses of Diesel Fuel in a Motor Vehicle, provides safe-harbor percentages which are presumed amounts of diesel fuel used to operate auxiliary equipment. Safe-harbor percentage must be applied to diesel fuel consumption by auxiliary equipment type. Off-highway use is included in the safe-harbor percentages. If your claim is not based on a safe-harbor percentage as provided in Regulation 1432, you must submit a specific fuel study to support the percentage claimed. Please check the Diesel User Frequently Asked Questions (FAQs) for information about conducting a fuel study.
  • Vehicles used on-highway and off-highway: You should do periodic tests to determine whether formulas you use to determine your off-highway use are accurate. See Regulation 1432, Other Nontaxable Uses of Diesel Fuel in a Motor Vehicle. You may want to Contact Us for more information.

Diesel User Frequently Asked Questions (FAQs)