Big diesel users in South Africa to get full refund from April

South Africa’s farmers, miners, and forestry operators have a reason to celebrate. The South African Revenue Service (SARS) has confirmed that from 1 April 2026, eligible onland diesel users will be able to claim 100% of their diesel costs, a boost from the previous 80% refund under the Diesel Refund Scheme.

This move follows the 2025 Budget announcement by Finance Minister Enoch Godongwana and is aimed at providing relief after the fuel levy hike that affected operational costs in critical industries.

From 80% to 100%

Previously, diesel users in sectors like agriculture, mining, and forestry could reclaim only 80% of eligible diesel purchases and usage. The upcoming change allows them to claim the full amount, increasing cash flow for industries heavily dependent on fuel for day-to-day operations.

SARS said this adjustment comes at an estimated cost of R1 billion in additional refunds to these sectors. The system upgrade is scheduled to align with April 2026 VAT returns, meaning claimants will see the change reflected when submitting returns in May 2026.

“The VAT return timing ensures that no claimant will be disadvantaged by the system upgrade,” SARS noted.

Streamlined claims and modernisation

This change is part of a wider effort by SARS to improve the Diesel Refund System. In December 2025, SARS launched a digital platform dedicated solely to diesel claims, separate from the VAT system.

The platform aims to:

• Reduce fraud

• Improve processing efficiency

• Provide better risk profiling

• Enable a more automated, modern approach to refunds

This digital overhaul ensures that diesel sellers and eligible users can register and submit claims more efficiently, cutting down on administrative hurdles.

Rules and documentation remain critical

While the refund rate increases, the standard rules for claiming diesel refunds remain in place:

• Claims must be made within two years of diesel purchase

• Documentation, including logbooks and purchase records, must be kept for five years

• Refunds incorrectly claimed must be repaid with applicable penalties and interest

SARS stressed that maintaining proper records is vital to avoid disputes or penalties.

Relief for industries

For many businesses, diesel is a major operational cost. Farmers running tractors, miners powering machinery, and forestry operators relying on diesel trucks will benefit directly from this full refund, helping offset rising fuel prices.

Industry insiders have welcomed the move, saying it provides certainty for budgeting and operations, especially as the economy continues to feel the ripple effects of energy price fluctuations.

As SARS rolls out its upgraded system, sectors that have long lobbied for relief can expect faster, more reliable claims, marking a significant step forward in supporting South Africa’s backbone industries.

This development is expected to provide immediate financial relief, bolster production, and streamline compliance, a welcome boost for big diesel users across the country.