commercial Oil

Changes to Tax Relief for Red Diesel

In the recent budget (March 2021), the Chancellor of the Exchequer confirmed impending changes to tax relief for ‘off-road’ or ‘red’ diesel. These changes will result in the removal of tax relief for some sectors and applications. Current duties will remain until 31st March 2022 and this new taxation legislation will be introduced from 1st April 2022.

This change does not apply to all sectors, with exemptions including agriculture, non-commercial heating, rail and commercial boat operators. Sectors such as construction, logistics and manufacturing will no longer be eligible for rebates on their red diesel consumption.

 

CLICK HERE  for a list of those customers exempt from the duty increase.

CLICK HERE for Guidance on changes to use of red diesel and other rebated fuels from 1st April 2022

 

CLICK HERE for the minutes of the meeting held between HMRC and UKIFDA 21st July 2023

 

From 1st April 2022, we and other UK fuel distributors will not be able to supply red diesel for non-exempt applications. Businesses affected by the changes should not purchase red diesel for use beyond 1st April 2022 and must run-down existing stock. We offer a range of alternative fuel options and can help with storage and tank flushing arrangements.

Customers should also be aware that other fuels that are currently subject to duty rebates for certain applications, such as kerosene and fuel oil, are also currently under Government review. Any further changes will be communicated as and when confirmed.

Our Trade Association, UKIFDA, continues to discuss these changes with government and we will keep you updated with changes and alternative fuel options as things become clearer. We will continue to support our customers and keep you informed through these legislative changes and their impacts on your business.