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HMRC spot checks on marinas using and selling red diesel

Published on: 05 October 2023

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Since British Marine’s webinar for members with HMRC in August there have been an increase in reports of HMRC carrying out inspections of marinas to check their compliance with the rules on the use and sale of red diesel.  For example, one business, which is not a member of British Marine, was found to be breaking regulations by using red diesel for on-site plant equipment. Under HMRC rules, this is not allowed and therefore the plant equipment was impounded.  

HMRC spot checks are also being undertaken to ensure marinas are taking the necessary steps to best ensure rebated fuel is only sold or supplied to customers that have a legitimate use for it. In the case of recreational (non-commercial) craft, rebated fuel should only be used for domestic use, such as onboard heating or generation of electricity, and should not be used for propulsion.

As emphasised at British Marine’s webinar, marinas selling red diesel should consider the integrity of their customers and be familiar with Excise Notices 75, 192 and 554 so that, if necessary, they can remind their customers of the rules. 

Marina customers are liable for providing marinas with accurate declaration forms and marinas themselves should refrain from simply applying duty based on a 60:40 split for propulsion v domestic use as it is an offence to knowingly sell red diesel for ineligible use.  Where fraud is suspected it should be reported to the HMRC’s Fraud Hotline (Telephone 0800 788 8867).    

The increase in HMRC spot checks comes at a time when the UK has been fined £28m by the European Court of Justice for having failed to introduce the EU ban on the use of red diesel in private pleasure boats within the required time whilst the UK was still a member of the EU.  Since Brexit, the UK Government has been able to set its own independent regulations on permitted use of red diesel for private pleasure craft as explained in HMRC Custom Notices referenced above.  

British Marine members are encouraged to stay up to date with the latest UK regulations affecting RDCOs by registering for HMRC newsletters via email [email protected].

If you concerns regarding your obligations as an RDCO please email [email protected] or for general issues relating to government policies please email: [email protected]