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HMRC release ‘Excise Notice 75’ ahead of changes to red diesel rules

30 Mar 2022 | Technical News

HM Revenue and Customs (HMRC) has now released an updated version of their Excise Notice 75 document.  This will serve as a definitive guide for red diesel users in the landscape industry – but also for HMRC inspectors charged with policing the rules due to come into force from 1 April 2022. 

The information and guidance contained within Excise Notice 75 is the same as previously reported by the Association, but users of red diesel are advised to note the document.   

Explanation of rules for users of red diesel in the landscape industry

Whilst agriculture, horticulture, fish farming and forestry sectors retain the entitlement to use red diesel from 1 April 2022, HMRC have explicitly excluded most landscaping activities from these sectors. 

Despite these exclusions, a small number of landscape operations retain the right to use red diesel.  The table below summarises the rules effective from 1 April 2022.

Activity Use of red diesel permitted?
Community Amateur Sports Club (CASC) maintenance* Yes
Golf course construction and maintenance* Yes
Commercial landscape construction No
Commercial tree works in parks and amenity areas Yes
Cutting verges, hedges or trees that border public roads** In agricultural vehicle only
Cutting grass in recreational areas (e.g. school playing fields, recreation fields, picnic areas, general grass area in public park) No
Cutting ornamental lawn in public park Yes
Clearance of trees and vegetation on wasteland No
Professional garden construction No
Professional garden maintenance Yes
Professional tree works in domestic garden Yes

* Community amateur sports club (CASC) and golf courses

Red diesel may be used in agricultural vehicles and unlicensed vehicles to maintain:

  • Land maintained by a Community Amateur Sports Club
  • A golf course
  • A golf driving range
  • Any machines or appliances (other than vehicles) being used in the venues above. This includes heating and lighting buildings, such as clubhouses and changing rooms

When working on these grounds, business owners can use rebated fuel in vehicles including:

  • Diggers
  • Cranes
  • Mowing machines
  • In special vehicles when the vehicle is going to or from a golf course or land maintained by a CASC, where the vehicle is used

Where the land or golf course is either side of a public road, business owners can use rebated fuel in an agricultural or special vehicle while travelling between the 2 parts by the shortest possible route, providing the vehicle is licensed to use the road.

** Cutting verges, hedges or trees that border public roads

Only an ‘agricultural vehicle’ which meets one of the following four definitions below can use red diesel to cut verges, hedges or trees that border public roads. 

The agricultural vehicle must fit into ONE of the following categories:

  1. A tractor.
  2. A single-seat vehicle of less than 1,000kg that is designed and constructed primarily for use off-road.
  3. A vehicle only used for agricultural, horticultural or forestry purposes, that is licensed by the DVLA to use public roads only when passing between 2 areas of land occupied by the same person, and that distance is less than 1.5 kilometres by road.
  4. A vehicle with permanently attached or built-in machinery used for handling or processing agricultural, horticultural, aquatic farming, forestry produce or materials — this category includes vehicles such as combined harvesters, crop sprayers, forage harvesters, pea viners, mobile seed cleaning machines and feed milling machines.

NOTE: the use of ‘road’ in the HMRC guidance includes:

  • Footpaths
  • Bridleways
  • Carriageway

How to prepare for the changes

In advance of 1 April 2022 members are encouraged to run down the fuel they have in machines and storage tanks to as close to nil as reasonably practicable.  

Members are permitted to use up rebated fuel in a vehicle or machine after 1 April 2022, if the fuel was legally put into the vehicle or machine before 1 April 2022.

If you only use fuel for non-accepted uses from 1 April 2022 as a result of these changes, you should plan to use up stocks of fuel held in storage tanks by this date.

You will not be expected to flush out any residue of rebated fuel from your storage tanks once it has been used up.

If you order supplies of rebated fuel between now and 1 April 2022, you should only order the amount you expect to use by that date.

You will need to keep records to show how and when the fuel was disposed of or sold.

You can sell or dispose of the surplus fuel without needing to be approved by HMRC as an RDCO.

You should make sure that you dispose of surplus rebated fuel correctly and safely through an approved waste oil recycling or disposal company.

Further reading:

HMRC document: Changes to rebated fuels entitlement from 1 April 2022

HMRC Excise Notice 75

 

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