UK red diesel tax changes

New tax rules affecting red diesel coming into effect on 1 April 2022
New tax rules affecting red diesel coming into effect on 1 April 2022

The leisure boat industry is being urged to read up on new tax rules affecting red diesel coming into effect on 1 April 2022. Consequently, the leisure boat industry is being urged to read up on new tax rules affecting red diesel.

From 1 April 2022, diesel used for propelling private pleasure craft can no longer benefit from a reduced rate of duty and it’s subject to duty at the full rate.

In Great Britain, a private pleasure craft may continue to use rebated (red) diesel, including rebated sulphur-free diesel and rebated bioblend (a mix of diesel and biodiesel) but, an amount equal to the rebate must be paid on the fuel used for propelling the boat.

Rebated fuel can contine to be used in all types of boat, except for private pleasure craft in Northern Ireland. This includes in their engines and in other machines and appliances permanently on the boat. Red diesel is being outlawed in private pleasure craft in Northern Ireland to meet the UK’s obligations under the Brexit withdrawal agreement.

Private and commercial boats in the rest of the UK can continue using red diesel following a government u-turn which overturned HMRC’s July 2020 ruling stating that privately-owned pleasure craft would also be banned from using the fuel.

Click for more information from the government’s website

 

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