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Have your say on the changes to red diesel entitlement!

Published on: 22 July 2020

Have your say on the changes to red diesel entitlement

Earlier this month HMRC published the long-awaited consultation on the continued use of red diesel.

The consultation “Reforms to the tax treatment of red diesel and other rebated fuels” confirms HMRC’s intention to remove the entitlement for users of private pleasure craft to use red diesel for the purposes of propulsion. The proposals will not, if taken forward, change the entitlement to use red diesel for the purposes of non-propulsion, such as heating and cooking.  

The measure is set to come into force from April 2022. 

Within the consultation, HMRC proposed to introduce a new relief scheme where approved fuel suppliers would be able to deduct from the sale price the duty difference on the proportion of white diesel intended for non-propulsion. The fuel suppliers would then reclaim this deducted duty from HMRC and reflect this in the price charged to the private pleasure craft user at the point of sale. 

British Marine will shortly be engaging with its members and issuing a survey to help inform its response to HMRC’s consultation. We will consult on the cost differential between red and white diesel, the continued use of the 60:40 split and the impact of the changes on suppliers. We will also continue to work closely with Government departments to ensure that members have all the appropriate guidance they need to understand the new requirements. 

We would encourage our members to visit our dedicated Red Diesel page and check Latest News for the survey which we will publish shortly.