The 1st April 2022 saw new rules surrounding the use of rebated red diesel and biofuels. The change in legislation was brought in to reduce commercial reliance on fossil diesel, in turn to help the UK achieve its Net Zero Carbon target.

Speedy Fuels has been helping the sectors affected transition to an alternative fuel, whether that’s HVO fuel, Industrial Heating Oil (IHO) or white diesel (DERV).

Call 0330 123 3773 to find out more about how we can support your business.

Sectors affected

  • Construction and road maintenance
  • Logistics and haulage (including refrigeration units)
  • Mining and quarrying
  • Oil and gas extraction
  • Waste management
  • Commercial heating
  • Leisure
  • Airport operations
  • Manufacturing (such as ceramics, timber and steel)

Remember…

  • If you’re not an exempt industry, you must have moved to full-duty fuels by April 1st 2022. You will not be required to clean and flush your tanks beforehand
  • Save all your invoices and receipts to prove that you haven’t been stockpiling and have been purchasing full-duty fuels
  • Non-commercial bodies can continue to purchase red diesel for heating and electricity generation
  • Back-up fuel generators in commercial businesses can run their stock levels down as long as it was purchased before 11th June 2021

Switch to a clean burning fuel

Many businesses have used the new red diesel rules as an opportunity to switch to white HVO, Speedy Flame IHO and GTL.

Discover our sustainable fuel solutions that can help simplify your transition to a cleaner burning fuel.

Sustainable Fuel Solutions

How has speedy fuels been supporting businesses?

Our in-house experts have been working hard over the last few years to simplify unable businesses to switch to a non-rebated fuel. This has included uplifting your rebated fuel (minimum quantity 5,000 litres), cleaning the affected tanks if needed and delivering a fresh supply of HVO, IHO or DERV at competitive rates.

Call 0330 123 3773 to get in touch to speak to an expert.

Categories approved for use of red diesel after 1 April 2022

  • Rail transport
  • Community amateur sport clubs and golf courses
  • Sailing, boating and marine transport (excluding private pleasure craft in Northern Ireland)
  • Travelling fairs and circuses
  • Fuel used for non-commercial purposes – electricity generation and heating
  • Agriculture, horticulture, fish farming and forestry

KEY POINTS by Sector

Agriculture/Horticulture/Fish Farming/Forestry
Can use rebated fuels in agricultural vehicles, special vehicles, machines and appliances

Rail
Can only use rebated fuels to propel or stop vehicles that run on a railway. They cannot use rebated fuels for any other purpose such as cooling or heating units

Travelling Fairs and Circuses
Can only use rebated fuels to power rides, and for the provision of electricity and heating for caravan accommodation

Sailing, Boating and Marine
Rebated fuels can be used in all types of boat. It can be used on engines, and any other machines and appliances that are permanently on the boat

Golf Courses
Rebated fuels can be used in vehicles, special vehicles, heating and lighting within the course/club

Rebated fuel in unusual circumstances after 1 April 2022

In some circumstances, businesses may have been granted a licence if they could prove to HMRC why you cannot use full duty paid diesel.

For instance, you may use rebated fuel for technical or safety purposes because using full duty diesel fuel isn’t compatible with your vehicles, vessels, machines or appliances.

If they approve the licence, businesses will have been able to pay the difference in duty between the rebated and non-rebated fuels. The licence will will not be issued indefinitely and will be reviewed regularly.

The penalties of unlawfully using rebated fuel after 1 April 2022

HMRC recognises that there will be a transition period between the rule changes and rebated fuel being used up in a storage tank. The extent of this will depend on the:

  • type of vehicle, vessel, machine or appliance
  • size of fuel tank
  • rate of fuel consumption

It acknowledges that due to maintaining minimal stock levels for safety and operational reasons, full duty paid fuel may be blended with existing stocks of rebated fuel which may result in the red indicator being left in the tank after the rule changes.

HMRC will check receipts and invoice records and only target those who are wilfully and illegally using red diesel. If you’ve taken reasonable steps to switch to full duty fuels, it will work with you to ensure you’re on the right side of the law. It will check if testing and records of the stocks are consistent to determine if the rebated fuel was put in the tank before the rule changes.

If reasonable circumstances can’t be established, vehicles, machines, vessels or appliances found to be unlawfully running on rebated fuel will be detained until the duty has been paid.

Common Questions surround the rebated fuel rule changes

If I’m not in one of the exempt industries, will I be able to purchase red diesel after 1st April 2022?

No, you must purchase white diesel or a cleaner alternative such as white HVO.

Can I stockpile my red diesel?

No, HMRC has advised any non-exempt customers to plan their red diesel purchase/usage up to the 1st April 2022. So make sure you only buy what you will use by this date.

What do I do if I have rebated diesel fuel in my storage tank?

If you have any rebated fuel in your tanks after 31st March, you will need to either:

  • Sell or give to someone who is allowed to use it
  • Sell or give to any Registered Dealer in Controlled Oil (RDCO)
  • Dispose of it via an approved waste oil or recycling company


*Please keep records of any sales or disposal

You can sell or dispose of the fuel without needing to be approved by HMRC as an RDCO, but you must keep records to prove how this was done. You must dispose of rebated fuel safely and correctly by using an approved waste oil recycling or disposal company such as Speedy Fuels.

What records should I keep?

It’s important to keep accurate records of all fuels you have purchased to prove that you haven’t been stockpiling and that you have started the transition to non-rebated fuels.

Do the tax changes affect HVO fuel?

Yes, the rules apply to HVO in the same way as rebated fuels. If you’re no longer permitted to use red HVO, you must switch to white HVO.