Diesel Fuel Exempt User Claim for Refund

General Information

A diesel fuel exempt user includes any person who purchases tax-paid diesel fuel and uses it in a nontaxable manner.

Note: A diesel fuel exempt user does not include ultimate purchasers, such as farmers and exempt bus operators. Refunds of tax on these types of uses can only be claimed by the fuel supplier. Ultimate purchasers must seek reimbursement of the tax paid from their supplier.

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.

Note: Every July 1, the diesel fuel tax rate is adjusted based on changes in the California Consumer Price Index. The California Department of Tax and Fee Administration (CDTFA) generally announces the adjusted rate by the preceding May 1. Due to this annual rate adjustment, you may have transactions at different tax rates. The diesel fuel tax rate is located on the Special Taxes and Fees Tax Rates webpage, under Diesel Fuel Tax.

Safe-Harbor Percentages

Safe-harbor percentages are amounts of fuel presumed to be the percentages of diesel fuel used in the operation of auxiliary equipment on diesel powered motor vehicles. Safe-harbor percentages must be applied to diesel fuel consumption by auxiliary equipment type. Off-highway use is included in the safe-harbor percentages.

Please reference Diesel Fuel Tax Regulation 1432, Other Nontaxable Uses of Diesel Fuel in a Motor Vehicle, for a list of safe-harbor percentages.

Filing Requirements

Registered diesel fuel exempt users may file a Diesel Fuel Claim for Refund on Nontaxable Uses, of tax paid on undyed diesel fuel used in an exempt manner. A claim for refund may be filed once a year for any amount, or at the end of any calendar quarter if the claim is at least $750.

You must file your claim for refund:

  • Within three years from the date the fuel was purchased, or
  • If the tax was not invoiced at the time of the purchase of the diesel fuel, within six months after the receipt of an invoice for the tax, whichever period expires later.

Note: If you are filing a claim for refund, you must complete all appropriate schedules and submit them with this claim. Refer to the Schedule Preparation section below for more information. Failure to properly complete the appropriate schedules will result in your refund claim not being accepted, and all accompanying documents will be returned to you.

Schedule Preparation

There are two types of supporting schedules required for Diesel Fuel Claim for Refund on Nontaxable Uses: Receipt Schedule and Disbursement Schedule. You must use the appropriate schedule code(s) for each receipt and disbursement activity claimed, listed under the Refund Claim Schedules section of the CDTFA-810-FTE, Instructions for Preparing Motor Fuels Schedules. Enter the schedule code for your activities on the Schedule tab of the FLT filing template (CDTFA-770-DU-E). In addition to a schedule code to describe the activity claimed, you must also indicate the type of product by entering the appropriate product code on the Schedule tab.

For detailed information regarding preparation of the schedules, please refer to CDTFA-810-FTE, Instructions for Preparing Motor Fuels Schedules, Refund Claim Schedules section.

List of codes used in schedule preparation can be located on our website, under Guidelines of the Motor Fuels Online Filing webpage.

File Attachment

To submit your CDTFA-770-DU-E, Diesel Fuel Claim for Refund on Nontaxable Uses, click the Add button to upload the file attachment.

On the Select a file to attach pop-up window:

  1. The file Type is defaulted to: Motor Fuels Flat File (FLT)
  2. Enter a description of the file in the Description field (for example: Account 123-456789, Period Jan. 2024).
  3. Click the Choose File button and follow the prompts to select and upload the file.
  4. Once you have completed all required information, click the Save button.

Click the Next button to proceed to the next screen.

For instructions on file preparation, including file type and formatting requirements, template Excel workbooks for creating Flat (FLT) files, sample files, and other useful information related to motor fuels online filing, please visit our website.

Review Totals

Do you agree with the refund calculated from the schedules?

The reported refund amount claimed from the file attachment may be different than the calculated refund amount claimed from the schedules.

If you agree to use the refund amount calculated from the schedules, select Yes and click Next.

If the calculated refund amount from the schedules is incorrect, do not proceed. You must first correct and resubmit the file attachment. Select the Previous button and follow the instructions to resubmit a corrected file attachment.

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