BMF Release Advice for Fuel Retailer - Red Diesel Update

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just goes to show they dont know their arse from thier elbow when it comes to this stupid regulation.

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Oh, I can't resist this quip: "Glad someone is looking at the important stuff whilst rome burns"

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Rick
 
Wow that's unbelievable. When the BMF statement was released the other day, we had kittens about the 5% thing, as up to that point everything indicated it would be 17.5% vat on the propulsion part. We made phone calls to both the BMF and HMRC and didn't get a satisfactory answer because the right people were not available.

That directive from HMRC dated 6th October clearly stated 17.5% VAT on propulsion and 5% VAT on Domestic so we were happy that that was correct. Why wouldn't we, as no-one had mentioned this throughout the whole process and VAT is charged at 17.5% on fuel used for propulsion on land.

Now I don't know what to say. If it's true, and it looks like it is as HMRC have clearly changed the wording on the directive since Monday, it's great news as it will make every litre a few pence cheaper.
 
They have absolutely no idea what they are doing. Who knows if their definition of 'Private Pleasure Craft' is even correct? Who knows if a single word in the document is correct?

A complete shambles, just like DEFRA who don't know the difference between the Environment Agency and British Waterways /forums/images/graemlins/frown.gif
 
In which case i'd better apologise to the BMF for saying people were right to slate them, seems they had simply passed on the HMRC notice before HMRC had updated their own website.
 
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yea
sure seems to me that they are saying 5pct on it all

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This seems to be good news for those with diesel engines.

What about the VAT payable on unleaded used for propulsion.....should that attract VAT at 5% too? As far as I can see, it is currently charged at 17.5%. Or have HMRC confused us, again?

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This seems to be good news for those with diesel engines.

What about the VAT payable on unleaded used for propulsion.....should that attract VAT at 5% too? As far as I can see, it is currently charged at 17.5%.

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The problem for the petrol boaters is the lack of a marked fuel - which means I doubt you'll see a VAT reduction or the 60/40 duty split. As I can't see one being introduced, I think you're stuck with the status quo /forums/images/graemlins/frown.gif

Rick
 
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This seems to be good news for those with diesel engines.

What about the VAT payable on unleaded used for propulsion.....should that attract VAT at 5% too? As far as I can see, it is currently charged at 17.5%.

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The problem for the petrol boaters is the lack of a marked fuel - which means I doubt you'll see a VAT reduction or the 60/40 duty split. As I can't see one being introduced, I think you're stuck with the status quo /forums/images/graemlins/frown.gif

Rick

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That's the answer I feared.........!! /forums/images/graemlins/frown.gif

Hope to see you tonight. /forums/images/graemlins/grin.gif
 
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Hope to see you tonight. /forums/images/graemlins/grin.gif

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Yeah - I should be there from around 7pm. See you if you make it.

Cheers,
Rick
 
I have written to HMRC to request confirmation that providing the declarion is made and is true as per the advice note, ie that 60% of my unleaded purchase is for navigation purposes, petrol sales from RCDO's will be treated the same as now proposed for red diesel sales.
 
On what grounds does this apply to petrol?
It will be illegal from 1 November 2008 for red diesel to be used for propelling private pleasure craft unless the purchaser of the fuel makes a declaration to that intent and pays the full rate of duty. Red diesel at the rebated rate of duty can continue to be used for domestic purposes such as heating and lighting.
There isnt, and never has been a rebated duty on petrol has there? So there is nothing to rebate underw this scheme?
 
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I have written to HMRC to request confirmation that providing the declarion is made and is true as per the advice note, ie that 60% of my unleaded purchase is for navigation purposes, petrol sales from RCDO's will be treated the same as now proposed for red diesel sales.

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I await your post with their response with much interest. I will not be holding my breath though!
 
Nope sorry mate, you've not got a snowball's chance in hell!
Buy a diesel boat? /forums/images/graemlins/wink.gif
 
As discussed down the pub last night, I suspect the 5% is to make the sums easier. It gives you a fixed sum to add per-litre for the % split. If my maths is right, thats (propulsion percentage * duty difference + vat) per litre. ie. % * 0.4066 * 1.05. So:

Propulsion % claimed, Additional pence/litre on top of current red price
10% 04.27p/litre
20% 08.54p/litre
30% 12.81p/litre
40% 17.08p/litre
50% 21.35p/litre
60% 25.62p/litre
70% 29.89p/litre
80% 34.15p/litre
90% 38.42p/litre
100% 42.69p/litre

Is that right? Certainly makes things a lot simpler for the retailer...

Rick
 
What pub was that then Rick? I'm clearly missing out here...

Your maths agrees with the couple of examples I worked out yesterday. Keeping the entire VAT element at 5% certainly makes life simpler for the retailer as well as cheaper for us all. I never thought we'd be paying less than a quid a litre post 1/11, but it looks like that'll be the case at the 'default' 60/40 split. With oil prices falling by the day it may end up being nearer the 90p mark.
 
If this is real and it looks like it is, why is it not splashed all over the YBW.com news pages, another 10ppl off red is big news, come on YBW /forums/images/graemlins/mad.gif
 
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