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Teletrac Navman

Outside Voices: ProMiles: Complying with the International Fuel Tax Agreement (IFTA)

Data Blocks
Data Blocks

A trusted partner of Teletrac Navman, Gary Markham is Director of National Accounts and Regulatory Compliance Services for ProMiles Software. Gary currently serves on the Industry Advisory Committee for both the International Fuel Tax Agreement (IFTA) and the International Registration Plan (IRP), and has a wealth of knowledge on how fleets can better manage regulatory requirements. Here's what Gary had to say when I asked him about the challenges of complying with IFTA.

What are the biggest challenges associated with complying with the International Fuel Tax Agreement (IFTA)?
 Although IFTA was created to streamline fuel tax reporting, as carriers previously had to file a return in every jurisdiction they traveled in, it is still a relatively intensive process. Just how intensive depends on the method used to track fuel use. Those that rely on manually processes and paper records are at a disadvantage, both with regard to the time and resources it requires to comply, and with the risks associated with paper logs. Paper logs put the burden on the driver, who must fill out daily driving reports that include routes/miles traveled, odometer readings and fuel purchases/receipts. Storage is also a challenge with paper records, as most carriers don’t want to maintain logs for more than six months. IFTA requirements vary slightly per state, but fleets are generally expected to keep records for four years. That’s a lot of paper to store in a warehouse, not to mention the need to keep paper records organized and easily accessible in case of an audit.

What are the risks of non-compliance with IFTA?
 There are a few different risks involved with non-compliance, most in the form of monetary fines. If a fleet doesn't file on time (the last day of the month following the quarter), there is a minimum fine of $50, although it can be as much as 10% of the total filing. For the larger carriers, this could add up to tens or hundreds of thousands of dollars, and vehicles can be seized or impounded in the process. If an auditor determines there was some kind of fraudulent intent, fleets then have the cost of defending that, and could face criminal prosecution and fines of up to $5,000. Although IFTA only requires jurisdictions to audit 3% of the total carriers in their state, it’s a random 3%. Those that file late will get more scrutiny, raising the potential for an audit.

What data is most helpful when trying to ensure compliance with IFTA?
 IFTA has put several requirements in place, asking for specific location, mileage and fuel consumption data. Fleets must have the original GPS points vehicles traveled and be able to show where that is on the road (ex. I-95, south of XX exit or town). They must provide the date and time stamp where the GPS point occurred, miles between each point traveled, ECM odometer reading and the specific route for each vehicle (including identifiers on vehicle records). Not only is it important to keep track of this data, carriers should also review the information monthly, (or at least before they file), looking for any gaps in travel, missing trips or odometer readings, fuel purchases in a jurisdiction where there was no recorded travel and suspicious miles per gallon measurements (MPGs).

What are the benefits of adopting technology like a GPS tracking solution to automate fuel tax reporting?
 First and foremost, automating fuel tax reporting eliminates all of the manual processes and storage requirements involved with paper logs, saving administrative office time with auditing, reconciliation, error handling, and having to resubmit to drivers, operations to correct. It also provides more accurate trip records, as these technologies can take GPS points traveled and feed the data through a routing engine that accumulates trips and looks for gaps. Fuel card providers eliminate the need for drivers to acquire a fuel ticket, and match travel and fuel accordingly, looking for odometer readings that are repetitive or stuck. Drivers no longer have to file a trip report, which raises their satisfaction on the job and improves retention. Using technology, like a fleet management software, also simplifies the auditing process, should that happen, by maintaining all historical raw data in an organized manner, able to pull records from a specific truck during a specific time period. More carriers are adopting automated solutions to reap these benefits, pairing their GPS fleet tracking technology with specific fuel tax reporting software.

To learn more about IFTA, visit:

To learn more about Teletrac Navman's partnership with ProMiles to streamline IFTA reporting, visit:

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