For a lot of owner-operators and company drivers, it is a bit complex to understand the (IFTA) International Fuel Tax Agreement. Drivers who have knowledge of the history of IFTA and the reason as to why it was developed, believe they will be able to make more strategic decisions that could result in enhanced savings and revenue.
Before the introduction of IFTA, drivers had to buy fuel permit for every state they traveled in. This required carriers and drivers to stop in a lot of port entries. Due to the extra miles and stops, many carriers and drivers frequently lost lots of cash and time.
In the 1980s, officials from Arizona, Washington and Iowa agreed on a single permit. The concept behind this decision was to have a single permit where taxes would be evaluated by a single authority. This will be shared among localities and states based on the number of miles a driver or carrier drives in every region. Over the next 15 years, the agreement developed, and now, it consists of the 10 provinces in Canada and the lower 48 states. Below, we will be looking into how to complete your IFTA sticker report.
Running a quarterly IFTA report
There are numerous items you will require to monitor every quarter for your IFTA reports, and these can get difficult. Nonetheless, you want to ensure you understand what these items are from the beginning if you don’t want to be under pressure when the due date for reports is near.
For every vehicle that qualifies for a report, and for every type of fuel, the following are a few things you will have to monitor and put together for your IFTA report:
- Overall miles and taxable miles covered in every member zone
- Number of tax paid gallons bought in every member zone
- Overall miles covered, which includes none-member zones
- Overall fuel gallons used up including non-member zones
Tax-paid gallons bought are the gallons of fuels you buy at the pump, which includes tax. It will be vital to secure all the receipts you get each time you purchase fuel to keep a record of the time, date, name of the seller, type of fuel, the price per gallon and amount of gallons purchased. All of these are information the IFTA deems vital. If you work with software for fleet management, which comes with fuel card integration, it will monitor this data automatically.
When it has to do with recording the miles covered for IFTA, fleets adopt various techniques. Some of the typical ones consist of:
- Recording traveled miles manually or manually recording the odometer reading each time you go past a state line
- Using Google Maps to measure the distances of trips later on
- Capitalizing on a software approved by the IFTA which keeps track of your traveled miles.
In the long run, the ideal method will be dependent on your fleet and which is most accurate for you. It is vital for the records to be accurate, so ensure you are as detailed as possible when keeping records. This means you need to stay away from the urge to just inputting an estimate of your trip mileage.
Almost Time for IFTA 3rd Quarter Reports
It’s almost time for your 3rd quarter IFTA tax report which is due October 31st. Of course, you can do this report the hard way or the easy way. The hard way involves stacks of receipts and hours of paperwork. Plus, you’ve got to be sure you are up-to-date on any ifta fuel tax rates that may have changed recently. Also, do you have all the documentation required to support your figures? Are you going to have to stay up all night for several nights, miss time on the road, and deal with the headaches that go along with this scenario?
Or, you can do your IFTA report the easy way. Our trucking management software is the solution to your IFTA nightmares. With TruckingOffice, you’ll finish up this report ahead of time and not have to worry about mistakes that can translate into fines and penalties. You’ll also be pleased to know that we can take care of the other administrative aspects of your business. Sign up for the 30-day free trial to find out why you won’t have to look ahead to the next IFTA quarterly report with dread and fear.
Fines and Deadlines
IFTA reporting is a task that your fleet will have to complete each quarter. If you turn in your report late or fail to turn it in, your fleet will need to pay a 10% fine of the net tax liability. For this reason, you need to ensure the due dates for your reports.
For the best reporting software for your automated records, try out Trucking Office for the best trucking management solutions.