SARS Just Took Your Diesel Refund to 100% — But Changed How You Have to Prove It
From 1 April 2026, onland farming, forestry, and mining operations can claim back the full fuel levy and RAF levy on qualifying diesel, up from 80%. The catch: SARS has moved the whole claims process onto a new standalone platform with automated checks, and the logbook that used to be good enough probably isn’t anymore.
Every farmer, forester, and mine operator running diesel-hungry equipment in South Africa has heard some version of “you can claim that back from SARS.” Most have been doing it — at 80%, through their VAT return, with a logbook that lives in a cab somewhere. That changed on 1 April 2026. The refund rate went up. The process that used to sit quietly inside your VAT201 didn’t survive the transition. This is what actually shifted, and why the bigger story isn’t the extra 20% — it’s whether your paperwork can survive what comes next.
What Actually Changed
A single percentage, with a real Budget number behind it.
SARS used to give onland farming, forestry, and mining operations back 80 cents of every rand of fuel tax they’d paid on qualifying diesel. Now it’s 100 cents. That’s the whole change — but it comes wrapped in a new system, and the system is the part that will actually cost or save you money.
The mechanism sits in Note 6 to Part 3 of Schedule 6 of the Customs and Excise Act, 1964, under rebate item 670.04. Until this year it capped refunds for onland primary sector users at 80% of the general fuel levy and Road Accident Fund (RAF) levy paid on eligible diesel. Effective 1 April 2026, that cap lifted to 100% for farming, forestry, and mining operations conducting qualifying activities onland.
The change traces back to Finance Minister Enoch Godongwana’s 2025 Budget Speech, where the increase was flagged as an alignment with the scheme’s original policy intent. SARS confirmed on 20 April 2026 that its systems had been updated to apply the new rate, though the practical mechanics of the transition meant claimants only saw 100% reflected from the return period submitted in May 2026 — a timing quirk, not a delay in the entitlement itself.
What the scheme refunds hasn’t changed: it’s still the general fuel levy and the RAF levy component of what you paid at the pump or through your bulk supplier — not the full fuel price, and not the carbon fuel levy. Those levy rates move every year in the Budget, so the rand value of “100%” shifts with them. What matters for your planning is the percentage, not a fixed number — check the current gazetted levy rates via SARS or your supplier before doing your own math on what a full year’s claim is worth.
Who Actually Qualifies
The 100% rate applies specifically to onland primary sector users in farming, forestry, and mining, claiming under rebate item 670.04. Diesel used for qualifying activities — tractors, harvesters, irrigation pumps, forestry equipment, mining haul trucks and similar plant — is what’s covered. Diesel used for general road transport or non-qualifying activities isn’t. If your operation spans multiple sectors or activities, that split matters for how much of your usage is actually eligible — this is a case where getting your registered tax practitioner or customs advisor to confirm your specific eligibility is worth the conversation.
The Part Nobody’s Talking About: The System Changed Too
Your diesel refund just moved out of your VAT return.
Diesel refunds used to hide inside your normal VAT201 submission. SARS has now pulled it out into its own dedicated system — which means it gets its own registration, its own scrutiny, and its own audit trail, separate from everything else you file.
SARS began modernising the Diesel Refund System in December 2025, and the direction of travel is clear: this is no longer a line item folded into your VAT return. It’s now a standalone platform, decoupled from the VAT system, dedicated to registering diesel sellers and eligible users and processing refund claims under Schedule 6 of the Customs and Excise Act as their own customs and excise process.
SARS has said the point of the change is to reduce fraud, tighten oversight, and improve risk profiling — in other words, claims that used to get bundled through with the rest of a VAT201 now sit in a system built specifically to scrutinise them. Full rollout of the new submission process is expected to continue through the 2026/27 period.
Why Most Operators Are About to Under-Claim
The rate went up. The paperwork bar went up more.
A bigger refund is only real money if the records behind it hold up. An automated system doesn’t give a fragmented spreadsheet the benefit of the doubt the way a human reviewer might have.
The gap between entitlement and actual money in the bank comes down to registration and record-keeping — and both are stricter than the old system assumed.
Registration isn’t automatic. Every claimant needs to be registered under rebate item 670.04 via a DA 185 customs and excise registration form, with supporting documentation — proof of the qualifying activity, VAT registration, banking details, and address verification. If your operation was claiming informally, or your registration lapsed, the 100% rate doesn’t apply to you until that’s sorted.
Record-keeping is the bigger issue. SARS requires detailed logbook entries distinguishing diesel purchased from diesel used, and diesel used for eligible activities from diesel used for non-eligible ones — down to which vehicle or piece of equipment consumed which litres, for which task. Supporting tax invoices need supplier VAT numbers, quantities, and dates. All of it — invoices, logbooks, claim submissions — must be retained for five years from the date of the claim, and any claim must be submitted within two years of the diesel purchase.
“Under the new SARS system, fragmented and often estimated records are a significant audit risk.”
Ricky Luntz, CEO, Refuel — quoted in Bizcommunity, April 2026That’s the practical bind a lot of onland operators are walking into. A logbook that was “good enough” for a human reviewer glancing over a VAT return is a different thing from a dataset an automated validation system is checking litre-for-litre against activity records. The businesses most exposed are the ones still running paper logbooks or loosely maintained spreadsheets across a fleet of vehicles — exactly the profile of a lot of mid-sized farming, forestry, and mining operations.
A Flag Worth Noting
Some industry commentary suggests claims spanning the March–April 2026 transition period need a blended calculation — old 80% rate for pre-1 April litres, new 100% rate from that date. That detail appears in limited sourcing rather than official SARS guidance directly confirming a specific formula. If your claim period straddles that boundary, raise it explicitly with SARS or your tax practitioner rather than assuming either rate applies to the whole period.
Getting Your Claim Audit-Ready
The practical checklist, in order.
Confirm your DA 185 registration is current
Check your registration status for rebate item 670.04. If you’ve never formally registered, or details have changed — new vehicles, new activities, new banking details — that needs updating before a claim can be processed at the new rate.
Verify your claim is actually reflecting 100%
Check your most recent return or platform submission. If it’s still showing the old 80% calculation, that’s worth flagging to SARS or your advisor immediately — every litre at the old rate is money left on the table.
Move usage records to a per-vehicle, per-activity standard
A single fleet-wide fuel total won’t satisfy the eligible-versus-non-eligible split the system is checking for. Records need to tie litres to specific vehicles and specific qualifying activities.
Set a five-year retention system for everything
Purchase invoices, logbook entries, and claim submissions all need to survive five years from the date of claim — not five years from purchase. Build that into whatever record-keeping system you use, digital or otherwise.
Get your specific claim calculation checked by a registered tax practitioner
The rate change, the transition period, and the eligible-litre calculation all have enough nuance that a professional sign-off on your first claim under the new system is worth the fee — especially given how new the standalone platform still is.
The Bottom Line
The headline is genuinely good news: a real, Budget-confirmed increase from 80% to 100% puts meaningful money back into the hands of onland farming, forestry, and mining operators running diesel fleets. That part isn’t in dispute.
The part worth taking seriously is that SARS didn’t just raise the rate — it rebuilt the system around it. A standalone platform, dedicated registration, and automated validation mean the days of a reasonably-kept logbook sliding through inside a VAT return are ending. The operators who benefit fully from this change will be the ones who treat the record-keeping upgrade as seriously as the rate increase itself. The ones who don’t will keep claiming at effective rates well below 100%, or worse, find a claim rejected on audit.
This article is general commentary on a regulatory change, not tax, legal, or professional advice. Eligibility, calculation, and claim mechanics under the Diesel Refund Scheme are technical and situation-specific — confirm your position with SARS directly or with a registered tax practitioner before submitting or relying on any claim.