Regulations and Technical Services Group

What colour should your diesel be?

Following the UK's departure from the EU RATS has issued a new advice note (2 June 2021) to members who may be visiting the EU27 and other countries.

In Northern Ireland, since October 2021 it is no longer legal to purchase red diesel for propulsion of private pleasure craft. Red diesel is still sold for private pleasure craft in the rest of the UK, however.

HMRC has made a further revision to the VAT 'Returned Good Relief' (RGR) rules that now apply to yachts following the end of the Brexit transition period. The headline news is that the "grace period" allowed for the return of yachts from the EU to the UK without VAT being due has been extended from 31 December 2021 to 30 June 2022.

The CA received the following statement from the Stakeholder Engagement Team of HM Revenue and Customs:

From 30 June non-commercial vessels wishing to refuel in Northern Ireland must do so with white diesel. What’s the snag? There are no marine white diesel pumps in Northern Ireland, and demand is insufficient for commercial operators to make provision.

The Cruising Association (CA) is delighted that the government has reviewed its proposals for the reform of UK red diesel regulations for marine craft, as announced in yesterday’s Spring Budget. It has concluded that removing the entitlement to use red diesel in the commercial sector, including water borne freight, ferries, fishing vessels, operating at sea or inland, would have had a detrimental effect on their finances and viabilities.

Marine red diesel is still on sale to leisure vessels in the UK, despite the Government’s plans to phase it out following a judgment from the European Court of Justice. Now that Britain has left the EU, red diesel will continue to be legal for the propulsion of vessels in the UK until April 2022. However, red diesel in crafts’ engine tanks is not permitted in the EU27 and other countries.

The key Brexit issues affecting the sailing community have been addressed in a recently held Brexit Special Webinar entitled "Brexit Issues for Cruisers", the contents of which was researched and presented by members of the Cruising Association (CA) Regulations and Technical Services group (RATS).