New red diesel rules - can I still use it?

The Government announced duty changes to the use of red diesel in 2020, deciding the fuel – and other rebated biofuels - would be banned for certain uses after April 2022. We look at what the new rules for red diesel are who they affect as fuel prices rocket in a quick and easy to ready explainer.

Tractor using red dieselCan the likes of farmers and builders use red diesel after April 2022? We have the answers here. (Credit: Pexels)

What is red diesel?

“Red diesel” is the term used for gas oil that is used in vehicles other than standard road-use cars and lorries etc.

The fuel is marked with a red dye and is currently used for the likes of agricultural vehicles, heating and fishing fleets among many others.

Duty paid on it is charged at a lower rate than fuel used in road vehicles – also known as ‘white diesel'.

This DERV fuel has a duty rate of  57.95 pence per litre (ppl) at the pump, whereas the 'red' version has a duty rebate of 46.81ppl, which basically equates to a rate of 11.14ppl. A significant saving compared with the white version.

Why is it called red diesel?

To help government agencies identify people or businesses using the cheaper fuel to dodge higher rates of duty, a red dye and other chemicals have been added since 1961. This allows officers to visually check tanks and take samples to test for the chemical markers.

This helps to identify road vehicles misusing the fuel.

How much of the fuel is used in the UK?

There is a huge amount of this fuel being used in the UK, with the reduced rate costing around £2.4billion a year compared to if the full duty was paid, according to the Government. This type of fuel accounts for 15% of all the diesel used in the UK.

Why is the rebated red diesel going to be banned?

Red diesel is not being banned entirely, but just for certain users who are currently allowed to use it. From April 2022, these users will be banned from using it in an attempt to help the Government achieve its aim of seeing the UK become carbon neutral by 2050. It is also to help persuade users to move away from such fuels to greener options ahead of a ban on all new petrol and diesel vehicle sales in 2030.

Who is being banned from using red diesel in April 2022?

Commercial and domestic users including the following will be prevented from using rebated red fuel from 1 April 2022, and will have to swap to the white version or other fuels.

  • Off-road construction machinery such as excavators, tipper trucks and JCBs
  • Leisure
  • Mining and quarrying
  • Haulage - for transport refrigeration units on lorries
  • Ports
  • Manufacturing
  • Airport operations
  • Oil and gas extraction
  • Waste management
  • Commercial heating

Find out more about relief on duty for fuels and oils here

Who can continue to use red diesel?

The following are among the users that can continue to use red version of the fuel?

  • Agriculture, forestry, horticulture, fish farming
  • Rail, which include passenger and freight services
  • Powering non-commercial heating systems, such as homes, narrowboats and churches

Will it affect my road car? Will I have to pay more

No. Users of road vehicles, such as a cars or vans will have to continue to use the current version of fuel and pay the full duty as before.

If I fill my vehicle up with red diesel abroad, can I use it in the UK after 1 April 2022?

In some European counties – and the Channel Islands – the use of rebated fuel will remain legal for certain vehicle uses that have been restricted in the UK, so what happens if you fill up a vehicle or plant appliance with the fuel in one of these countries and then return to the UK?

In this case, the Government says that you will be allowed to use the restricted fuel when you return to the UK. However, you will need to retain receipts to prove the fuel was purchased outside the UK and not unlawfully.

What is the fine for using red diesel illegally?

If you are caught using this fuel illegally, you can be fined based on the extent of use and have the vehicle seized. You could also be forced to pay duty on the fuel you have used. In serious cases, offenders could be imprisoned for up to seven years and face an unlimited fine. 

Find more information on penalties for misuse of fuel here

Information on this page is just for general advice, check with a professional body or the Gov.UK website for more detailed information. 

 
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