Supplier of Motor Vehicle Fuel Tax Return

General Information

Per Regulation 1123, Supplier, all licensed fuel suppliers are required to report tax on motor vehicle fuel, which includes gasoline, gasohol blends containing more than 15 percent gasoline, gasoline blendstocks, and aviation gasoline. The Motor Vehicle Fuel Tax is imposed on the following activities:

  • Removal of motor vehicle fuel from a refinery or terminal rack;
  • Importation of motor vehicle fuel outside the bulk transfer/terminal system;
  • Removal or sale of motor vehicle fuel to an unlicensed person unless there was a prior taxable removal, entry, or sale; and
  • Removal or sale of blended motor vehicle fuel outside the bulk transfer/terminal system.

All transactions involving these activities are subject to tax unless the transaction meets one of the exemptions allowed in the Motor Vehicle Fuel Tax Law.

Note: Every July 1, the motor vehicle 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 several different tax rates. The motor vehicle fuel tax rate is located on the Special Taxes and Fees Tax Rates webpage, under Motor Vehicle Fuel Tax.

Filing Requirements

Every licensed motor vehicle fuel supplier is required to file a Supplier of Motor Vehicle Fuel Tax Return and supporting schedules, reporting all motor vehicle fuel activities such as importing and exporting above and below the terminal rack, blending, and refinery or terminal rack removals of motor vehicle fuel in California.

A return must be filed each reporting period, on or before the last day of the calendar month following the reporting period, even if you do not have any activity to report. A copy of the return and supporting schedules should be retained for verification by CDTFA auditors. Remittance for the amount due must be made payable to the California State Controller and submitted by the due date of the return.

Prepayment Requirement

If your tax liability averages more than nine hundred thousand dollars ($900,000.00) per month, you will be notified by CDTFA, that your account is required to be on a monthly prepayment basis (Revenue and Taxation Code (R&TC) 7659.1). Each month, you will be required to prepay your taxes on or before the 15th day following each monthly period. In addition to the monthly prepayment, you must also file the regular monthly Supplier of Motor Vehicle Fuel Tax Return, on or before the last day of the month following the reporting period. Payment for the remaining tax due should accompany the return.

Option 1: You are required to pay an amount not less than ninety-five percent (95%) of the tax liability for the month to which the prepayment applies. For example, if you are prepaying for the current month, then you will prepay at least ninety-five percent (95%) of the tax liability for this period. Or,

Option 2: You are required to pay an amount not less than ninety-five percent (95%) of the amount of the tax liability reported for the previous month.

Note:The amount of the prepayment shall constitute a credit against the amount of the tax due and payable for the monthly period for which the prepayment was made and for each subsequent monthly prepayment or period until the credit is fully utilized. In lieu of this procedure, a claim for refund for excess prepayment must be made if an actual refund is desired.

Penalty and Interest

The penalty for filing a late return and/or late payment is ten percent of the amount due for the period. Interest also applies to late payments for each month or fraction of a month that the payment is late. (R&TC 7655)

For accounts on a monthly prepayment basis, a six percent penalty will be assessed on late prepayment. (R&TC 7659.5)

Failure to file a return may result in revocation of your Motor Vehicle Fuel Supplier account and a $50 reinstatement fee (R&TC 7510).

Accountability

You must report all transactions that are required on this tax return and supporting schedules. CDTFA will be comparing your total rack removals, as reported by terminals, against removals reported by you. Your imports of products will be compared to exports reported to CDTFA by other states. Failure to report fully may result in CDTFA contacting you.

Schedule Preparation

If you have any activities during this reporting period, you must report using the applicable schedule code(s) for each receipt and disbursement activity. Schedules are not required if you have no activity to report.

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

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

Tax Computation Worksheet Preparation

The Tax Computation Worksheet is provided to assist you in calculating the tax due and completing your return. This worksheet should be kept with your records. When completing the schedules, please remember that tax is due on total gallons sold, including partial gallons; therefore, round up or down to the nearest whole gallon to avoid reporting errors.

File Attachment

To submit your CDTFA-501-PS-E, Supplier of Motor Vehicle Fuel Tax Return, click the Add button to upload the file attachment.

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

  1. Click the Type drop-down menu and select the appropriate file type. Available options to select from:
    • EDI Attachment (Electronic Data Interchange)
    • Motor Fuels Flat File (FLT)
  2. Enter a description of the file in the Description field (for example: Account 123-456789, Period Jan. 2023).
  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.

Note:If filing an amended return, only report transactions that occurred within the reporting period.

Review Totals

Do you agree with the tax due calculated from the schedules?

The reported tax due from the file attachment may be different than the calculated tax due from the schedules.

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

If the calculated tax 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.

Excess Tax Collected

Did you collect more tax than what is due (excess tax)?

If you have collected more tax than what is due (excess tax) for this reporting period, select Yes and enter the amount of excess tax collected. (Revenue and Taxation Code 8127.5)

If you did not over collect for this reporting period, select No.

Excess tax collected can occur in the following situations:

  • When tax is computed on a transaction which is not subject to tax;
  • When tax is computed on an amount in excess of the amount subject to tax;
  • When tax is computed using a tax rate higher than the rate imposed by law; and
  • When mathematical or clerical errors result in an overstatement of the tax on a billing.

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