Tax and Revenue Administration Fuel Tax Act Information Circular LPG-2R2

LPG-2R2 / November 2004

ALBERTA FUEL TAX ACT INFORMATION CIRCULAR - PROPANE PRODUCERS AND DISTRIBUTORS:
REPORTING AND REMITTING REQUIREMENTS

This Information Circular sets out the responsibilities of producers and distributors of propane under the Fuel Tax Act and Regulations. The topics discussed include:

• Reporting by Propane Producers
• Reporting by Propane Distributors
• Remitting Tax
• Records and Records Retention

Reporting by Propane Producers

1. Producers (including propane brokers) must report all taxable propane sales made to customers during a month (or another accounting period if approved) to Alberta Finance, Tax and Revenue Administration ("TRA") by submitting a Propane Tax Return (form AT360). They must also remit the tax collected on the sales. The Propane Tax Return and tax remittance must be received by TRA no later than the 28th day following the end of the accounting period in which the tax was collected. If the 28th day falls on a weekend or a government holiday, the due date is the next business day. A return is not required if no taxable sales were made during the period.
   
   
2. Producers must keep records of sales to consumers made tax-out (see paragraphs 6 to 10 for details on records retention). Information Circular LPG-1 discusses in detail sales made tax-out to purchasers of liquid petroleum gas (LPG).

Reporting by Propane Distributors

3. Distributors must submit an Propane Tax Return (form AT360) to TRA reporting taxable propane sales made during a month (or another accounting period if approved) and the tax collected. The return and remittance must be received by TRA no later than the 28th day after the end of the accounting period. If the 28th day falls on a weekend or a government holiday, then the due date is the next business day. A return is required for each accounting period, whether or not taxable sales were made.

Remitting Tax

4. A person who has possession of, or control over, funds collected as taxes under the Act holds those funds in trust for the Provincial Minister. Taxes may be remitted to TRA by any of the following methods:

   a) mailed, delivered by courier or hand-delivered to TRA. Remittances should be made payable to the Minister of Finance and accompanied by a Remittance Advice. The effective date of receipt of a mailed or delivered remittance is the date it is actually received by TRA. Remittance s mailed or couriered to TRA should be sent with adequate lead-time to ensure receipt on or before the due date. If hand-delivered, they should be taken to one of the Alberta Finance offices listed on this circular, between the hours of 8:15 a.m. and 4:30 p.m., Monday to Friday, except government holidays.

   b) at most financial institutions in Canada, if accompanied by a remittance advice. T he effective date of receipt is the business day stamped on the Remittance Advice by the institution.

   c) by wire transfer. The effective date of receipt is the business date the funds are received by TRA's bank. For more information on this option, contact TRA at (780) 427-3044 or 310-0000 / (780) 427-3044 (Alberta toll-free).

   d) through internet payment services provided by major financial institutions in Canada. The effective date of receipt is the date TRA's account is credited. The earliest possible effective date is the next business day. For further details on this option, contact your financial institution or call TRA at the above number.

5. If a payment is late or deficient, interest will be charged on the amount that is not paid as set out in Information Circular LPG-4.

Records and Records Retention

6. Producers and distributors must clearly indicate on all invoices whether the sale of propane is tax-in or tax-out. Where tax is charged on the sale, the tax should be shown separately on the invoice.
   
   
7. Certain records are to be retained by producers and distributors for a period of four years from the end of the calendar year to which the records and books of account relate. Records may be destroyed after this time, unless TRA has formally specified they be kept for a longer period. Records may only be destroyed before the end of the required retention period if written permission is received from TRA.
   
   
8. Records and books, including supporting documentation, should be kept at the producer's or distributor's place of business or residence in Alberta, unless approval is received from TRA to locate the records elsewhere in Canada, or outside the country.
   
   
9. If a producer or distributor has received permission to keep its records outside of Canada, it must, upon TRA's request and at its own cost, forward its records, books and supporting documentation to TRA or a business location in Canada, or arrange to have TRA's audit staff visit at the location of the records and books. In the latter instance, the producer or distributor will be responsible for absorbing the incremental costs incurred in sending auditors outside Canada.
   
   
10. The type of records and books of account which must be retained for the required period noted in paragraph 7 above include:

    • purchase records for propane (purchase orders, exchange agreements, records of exports, transfers, swaps, loans, exchanges and invoices from suppliers);
    • information related to retailer locations such as totalizer meter readings requested by TRA and records of meter repairs and recalibrations;
    • sales records (invoices to customers, accounts receivable statements or ledgers and bank statements);
    • records of customers' exemption and registration numbers (see Information Circular LPG-1);
    • records of inter-company transfers, import and export records and related documentation;
    • computer records of any/all of the above and additional computer files and records used for the preparation of, or as an information source for, the tax return, including a copy (i.e., backup on tape or diskette) of any program used to create, maintain and review these records.