Confirmation all fuel from 1 November will at 5% VAT not 17.5%

The 40% is not realistic for anybody bar livaboards, but this is what HMRC have generously decided. What domestic use is has not been defined, so if your batteries are charged by the engine and used to power domestics its appears that counts, likewise hot water heated off the engine. At least HMRC have not said it doesn't count.

However I fear the whole ruse will be ruined by some sore raggies, who were hoping that all the powerboats were going to dissappear.
 
domestic use is has not been defined

*
not defined, but illustrated:
"intended for domestic use (heating, lighting etc)"
and
IF "a craft clearly has no domestic use, then you must declare your actual intended usage. "

That second phrase seems to me to be the key.. something on which you can eat,cook,sleep,heat etc has a potential domestic use, and in such circumstances, Customs thinks 60/40 is an good guideline. If its good enough for them, its good enough for me.

However, if your vessel quite plainly cannot support those domestic activities , you would be ill advised to claim it can.

It seems fairly straightforward, doesnt it?
 
Hi Simon,

There's a long thread on the red diesel forum that should answer your question, but to summarise:

It's almost impossible to calculate exactly how much of your diesel goes to propelling your boat and how much goes to charging your batteries, heating your water, powering your electronics, etc...

Therefore, HMRC came up with 60/40. And while they haven't explicitly said that everyone with a diesel boat can fill up with 60/40 and not worry about the Customs man, they certainly have implied such.

The declaration you make at the pump is breathtakingly simple - you simply write on a bit of paper “I declare that 60% of the fuel being purchased will be used for propelling a private pleasure craft.” You must sign and date it, and the vendor must have a record of your name and address. The declaration is then attached to the fuel receipt and filed by the vendor. It is not sent to HMRC.

Fuel vendors are audited every couple of years or so. When they are, some unlucky civil servant (who has probably never been on a motorboat like yours) will have to go through thousands upon thousands of declarations, with no clue as to what type of boat the fuel went in to, nor what equipment is on that boat. I have been led to believe that in this scenario, all those saying 60/40 will be passed over. It's the declarations outside this apportionment that will raise flags.

Stewart
 
[ QUOTE ]
I have been led to believe that in this scenario, all those saying 60/40 will be passed over. It's the declarations outside this apportionment that will raise flags.

Stewart

[/ QUOTE ]

Thanks but I suspect that in order to capture enough information to be able to take any action/follow-up whatsoever on those declarations outside the 60/40 then they will have to mandate such information is captured from everyone. That would leave anyone making a 60/40 declaration (or indeed anything other than a 100/0 declaration) on fuel for vessels without any means of consuming diesel other than the main engine visibly exposed IMHO.

I can't think of any other area of taxation where the taxpayer can rely upon the interpretation by HMRC of alledgedly conveniently vague legislation being in the taxpayers favour.

First audits will show that nothing can be followed up, this will lead to mandatory contact information being captured, this will then be expanded to a simple equipment declaration (eg is heating fitted), then a case study showing that the 60/40 is inaccurate and 80/20 a better figure (liveaboards will be assessed as able to justify their usage anyway), before you know it a small-but-with-huge-powers HMRC unit is setup to monitor/prosecute and retrieve the lost revenue....

...of course I may be surprised (it won't be pleasant as I have a petrol boat....but with a diesel eber - 0/100 declaration anyone???)
 
Yes but, quite often when I take some one on the boat, a friend, or more usually girl friend. They will say, it's there turn to pay. So they do. So they say, what persentage of our use will be for propulsion, so I say, none, were just stopping in the marina and bonking. So thats what we do. So girl friend gets £300 worth of fuel at heating rate, and signs for it.

A year later, I've sacked the girl friend and moved to a new marina with my boat now called Ospray.

The HMRC smells a rat here and contacts the EX, who honestly says, no we did not go anywhere at all, we were bonking all week.

What now HMRC?
 
I'm sure there are those who'll take the piss. Ultimately I guess if too many folks do, we'll lose the fairly reasonable scheme proposed for something far less favourable.

Rick
 
Playing devils advocate then - I'm not sure HMRC will care. If they do the audit, and go to friend/GF and ask them to justify the 0% propulsion declaration and they can't - then they'll get a big bill. ie. I think the burden of proof will be with the friend/GF rather than HMRC.

Rick
 
right, but if you dont have anything"domestic", quite what electricity generation are you refering to?
In the end, you make your own declaration. If you dont like claiming 60/40 as you think its totally wrong for you, then declare something else.
If you want to claim 60/40 and cant possibly justify it, thats up to you too.
It all seems so very simple. Either you think you could well fit into a domestic use catergory, or you dont.If you do, you might as well use their split as anyone elses guess.
 
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