IFTA Compliance: How a Fleet Management System Helps You Comply

27 Apr 2022

If you own or manage a fleet of vehicles in the U.S. or Canada, you are likely familiar with the International Fuel Tax Agreement (IFTA). The IFTA is an agreement between the lower 48 United States and ten Canadian provinces for the reporting of fuel use by trucking companies operating in multiple jurisdictions. The IFTA was established in order to make it easier for transportation companies that own a fleet of vehicles to report and pay their fuel taxes.

How Does the IFTA Work?

 Motor vehicles with a gross vehicle weight of 26,000 pounds or more, and/or three or more axles, along with any trucks used across state lines or the US/Canada border, are required to comply with the IFTA.

To be compliant with the IFTA, IFTA carriers have to be registered with the International Registration Plan (IRP). All qualified trucks are provided with decals that must be replaced annually and displayed at all times.

Thanks to IFTA, fleets are only required to report fuel usage to their base state rather than reporting fuel usage for every state they crossed. This greatly simplifies the process of reporting fuel usage for taxes. The base state is then responsible for:

  1. Processing the carrier’s quarterly IFTA tax return.
  2. Collecting from or refunding the carrier a net fuel use tax representing the taxes owed to or from all the states in which the carrier operates.
  3. Distributing to, or receiving from, other states the amount of fuel use tax owed.
  4. Auditing the carrier on behalf of all IFTA member jurisdictions.

How Can GPS Fleet Tracking Can Help

First of all, using GPS fleet tracking can improve your business in a number of ways. As far as saving money on fuel goes, GPS fleet tracking can do that too by providing drivers and management with the information they need to find the fastest and most fuel-efficient routes.

GPS trackers can also help you identify problematic driving behavior that both endangers drivers on the road and wastes fuel, like hard accelerating, braking, and idling. Then, once the problem is identified, you can properly address the problem by retraining drivers on how to drive both safely and in a manner to conserve fuel.

Furthermore, with GPS fleet tracking software, you can automate IFTA reporting with fuel card management. This allows every driver in your fleet to connect locations and calculations of fueling to streamline your reporting. Then your team can provide this information to IFTA service providers, making the whole process that much easier.

With increased fuel prices, now is one of the best times to implement GPS fleet tracking into your business. Contact us here at LiveViewGPS at 1-888-544-0494, and we can help you with choosing the ideal system for your fleet.

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