Red diesel extended implementation date for Northern Ireland

HM Revenue and Customs (HMRC) has now confirmed that the change from red diesel to white diesel for propulsion in Northern Ireland (NI), will be delayed until 1 October 2021. The announcement follows the result of the red diesel consultation, published in March this year, when the Government announced that NI would have to follow the European Court of Justice ruling 2018 and supply only white diesel to private pleasure craft from June 2021.

The previously suggested date of June 2021 indicated the change to fuel usage would be implemented imminently, potentially having a negative impact on this year’s boating season. Both the RYA and RYA NI, amongst others, lobbied against such a rapid removal of the fuel with concerns over the absence of availability of white diesel at the waterside in NI. The RYA says it stressed to HMRC that deferring to later in the year would be essential in order for the industry to be able to accommodate such a significant change to essential infrastructure. The new date of October 2021, the RYA says, will also allow for the issuing of further guidance and communication for recreational boaters travelling in and around NI.

If a private pleasure craft in NI has separate tanks for propulsion and non-propulsion uses, then red diesel can be used in the non-propulsion fuel tank after 1 October 2021.

Fuel relief ratio confirmed

Where a private pleasure craft does not have separate tanks, HMRC has confirmed that white fuel purchased by recreational boaters in NI will have the fuel relief fixed at a ratio of 60% propulsion to 40% non-propulsion. The rest of the UK, where there is no fixed amount, will remain as such. HMRC has disclosed that the ratio must be fixed for fuel users in NI to ensure that the UK does not breach the NI Protocol in terms of the relief offered, in particular, the Energy Tax Directive.

Travel exemptions

HMRC has confirmed that recreational boaters travelling into NI from Great Britain (England, Scotland and Wales), can refuel their private pleasure craft with red diesel for propulsion in Great Britain after 1 October 2021, then travel to NI with the red diesel in the fuel tank without penalty.

However, if boaters travel to NI having refuelled with marked diesel from Great Britain, the Channel Islands or the Isle of Man, then the RYA advises that boaters retain fuel receipts or other documents (such as logbooks) to show HMRC where and when the vessel was refuelled.

Howard Pridding, RYA director of external affairs, comments: “The RYA welcomes the new changeover date from HMRC of 1 October 2021 which will avoid difficulties over the summer boating season and give companies time to adapt to supplying white diesel. We have had a constructive dialogue with HMRC officials who have listened to our concerns about the challenges for boaters and marine businesses, and we appreciate the pragmatic approach that has been taken. On behalf of our members, we will continue to work with the Government as the plans for implementation of the fuel changeover progress.”