The Price of Diesel (white & red)

[Lanners]

Hi All,

 

We are going into the water this week for the first time..very exciting! but we will need to get some diesel in her.

Am I right in assuming we can use red diesel, so long as its for heating? - If this is the case, how much should it be roughly?

There are facilities in the marina, but is it cheaper to go to a fuel merchant place?

 

Thanks

 

Toby.

[TimD]

The red-dye is so that the authorities can see if road vehicles have used it, and is OK to use in boats regardless of whether it's for heating or propulsion.

The question about how much tax you can/should/ought/do pay on the fuel is another topic ..... I thik I'll quickly pop round the shop to buy some popcorn :-)

 

Have fun on your new boat.

[Ray T]

Red diesel can be used for heating and propulsion - until interfering Brussels gets it way

[matty40s]

cheapest place I have seen was Wheaton Aston on the Shroppie, about 75.9 pplitre about 3 weeks ago, closely followed by Norbury Jnc which was 77.5ppl.

Normally in the Midlands I would expect to pay around 85-95ppl at the moment.

Diesel split is for you to declare, and a marina such as Braunston or Pillings which automatically designates 60/40 whether you like it or not would not get my business.

[Pie Eater]

cheapest place I have seen was Wheaton Aston on the Shroppie, about 75.9 pplitre about 3 weeks ago, closely followed by Norbury Jnc which was 77.5ppl.

Normally in the Midlands I would expect to pay around 85-95ppl at the moment.

Diesel split is for you to declare, and a marina such as Braunston or Pillings which automatically designates 60/40 whether you like it or not would not get my business.

I paid 89p per litre at Thorn Marine on the Bridgewater canal last week.

 

Steve

[ditchcrawler]

Hi All,

 

We are going into the water this week for the first time..very exciting! but we will need to get some diesel in her.

Am I right in assuming we can use red diesel, so long as its for heating? - If this is the case, how much should it be roughly?

There are facilities in the marina, but is it cheaper to go to a fuel merchant place?

 

Thanks

 

Toby.

This may give you some idea. http://diesel.fibrefactory.co.uk/

Yes it will probably be cheaper to go to a garage or fuel merchant that sells red diesel, but you will have the cost of the cans and transport to add to the equation.

[ditchcrawler]

Hi All,

 

We are going into the water this week for the first time..very exciting! but we will need to get some diesel in her.

Am I right in assuming we can use red diesel, so long as its for heating? - If this is the case, how much should it be roughly?

There are facilities in the marina, but is it cheaper to go to a fuel merchant place?

 

Thanks

 

Toby.

This may give you some idea. http://diesel.fibrefactory.co.uk/

Yes it will probably be cheaper to go to a garage or fuel merchant that sells red diesel, but you will have the cost of the cans and transport to add to the equation.

[bottle]

You get your diesel wherever you are on the system from a marina or a boat, you pay whatever they ask.

 

The price will vary examples already given.

 

The 'rules' are you can use red diesel for anything on the boat that requires diesel but if you use it to propel the boat through the water you must pay the extra duty.

 

You make a declaration and sign a piece of paper as to the use you expect the diesel to be used for. (see Matty's post #4 last sentence)

 

If you take £0.90 as the base price (heating/generation) then the propulsion will be about £1.40

 

We declare 20/80 (propulsion /generation) and I have records to prove that is our usage in case HMRC come calling. (they can but as yet have not done so)

 

The declaration is your responsibility, not the suppliers.

[roggie]

Have a look to see if there are any boats on your part of the system that sell diesel - thread on the forum - we paid 90p last month but that is down London way. Won't say too much about the declaration... Don't forget a wad of cash as your tank will take a lot of diesel - and its best to keep full over the winter due to condensation etc.

[BargeeSpud]

 

We declare 20/80 (propulsion /generation) and I have records to prove that is our usage in case HMRC come calling. (they can but as yet have not done so)

 

The declaration is your responsibility, not the suppliers.

That's the one thing that really hacks me off! Too many marinas illegally imposing the 60/40 split which has always been an assumption by HMRC of the probable split, but unscrupulous marinas have made it a requirement. Fortunately, I've never had an outright refusal to accept the split I've proffered, although I did come close once at Willowbridge in the early days of the ruling. No longer a problem now as the boat club has its own supply & I take 80 litres, on top of a full tank, with me when I cruise which is enough for a 2 week holiday.

[Paul C]

I don't understand why a marina would impose a compulsory 60/40 split if there were other marinas in the near-ish area which didn't. It would be commercial suicide. I guess in some areas, there's marinas with no competition?

[Boat&Bikes]

That's the one thing that really hacks me off! Too many marinas illegally imposing the 60/40 split which has always been an assumption by HMRC of the probable split, but unscrupulous marinas have made it a requirement. Fortunately, I've never had an outright refusal to accept the split I've proffered, although I did come close once at Willowbridge in the early days of the ruling. No longer a problem now as the boat club has its own supply & I take 80 litres, on top of a full tank, with me when I cruise which is enough for a 2 week holiday.

 

 

Are you saying that the marinas who impose a 60/40 split make a higher profit on diesel sales than if they sold at 80/20?

 

 

Ian.

[BargeeSpud]

I don't understand why a marina would impose a compulsory 60/40 split if there were other marinas in the near-ish area which didn't. It would be commercial suicide. I guess in some areas, there's marinas with no competition?

If they have direct competition, they might not, but then again even if there was competition, its a tax & it would be fairly easy to agree with your competitors to impose such a split without directly affecting profits. Think about it, they have to pass on the tax declared in their records to HMRC, so where's the incentive to complicate their bookwork with varying splits? If they impose the 60/40 it makes their lives simple & HMRC are hardly going to find it strange as that is what they thought the average would be at the time the rule came in.

 

I don't know if its changed, but in the early days, I heard that the Thames marinas were notorious for imposing a 60/40. With the recent clarification in the waterways press, hopefully this will now die a death & such impositions will be history (if they aren't already) although I would expect to see some establishments asking to see records, but again, this would not be legally compulsory as the sole responsibility in law lies with the person making the declaration, not the supplier.

 

Are you saying that the marinas who impose a 60/40 split make a higher profit on diesel sales than if they sold at 80/20?

 

 

Ian.

No Ian, they don't. Its a tax they have to pass on to HMRC & failure to do so properly would be tax fraud mate.

 

 

For those of you wondering, I have a leading VAT consultant for a brother & we've discussed this to death over the years since it came in!

 

Edited November 27, 2012 by Spuds

[Paul C]

If they have direct competition, they might not, but then again even if there was competition, its a tax & it would be fairly easy to agree with your competitors to impose such a split without directly affecting profits. Think about it, they have to pass on the tax declared in their records to HMRC, so where's the incentive to complicate their bookwork with varying splits? If they impose the 60/40 it makes their lives simple & HMRC are hardly going to find it strange as that is what they thought the average would be at the time the rule came in.

 

 

Thats why I said

 

if there were other marinas in the near-ish area which didn't.

 

EDIT: Let me put it another way, by asking a question: what is the most isolated diesel outlet on the connected canal/river network?

[alan_fincher]

That's the one thing that really hacks me off! Too many marinas illegally imposing the 60/40 split which has always been an assumption by HMRC of the probable split, but unscrupulous marinas have made it a requirement.

 

Actually, very annoying though it is, people have taken this up with HMRC, and they have indicated such marinas are not breaking the law.

 

I think it works along the lines of them effectively saying to you "we are prepared to enter into a deal with you to supply diesel, but only if your declared usage is going to be 60%/40% - if it isn't, we don;t want your trade, please go elsewhere".

 

Even when declaring 60%/40%, I still make a point of trying very hard never to use these people though, and think we all should.

 

In my view if trading fuel boats can manage to handle any split you want to declare, it shouldn't be beyond the skills of land based marinas to manage the sae.

[BargeeSpud]

Actually, very annoying though it is, people have taken this up with HMRC, and they have indicated such marinas are not breaking the law.

Sorry Alan, and I've discussed this very point with my brother, technically it IS illegal for a supplier to impose 60/40 in this situation where its the purchaser's responsibility, in law, for the declaration.

 

I can't speak for what others have been told by HMRC, but its entirely likely their enquiry has been misinterpreted by the official concerned. Unless they have spoken to someone directly involved with VAT in this area, they are unlikely to be given the proper information by an ordinary HMRC employee. As my brother says, making a complaint to HMRC is unlikely to produce any results as they will conclude they have much more serious issues to deal with than investigating a relatively small problem, as they would see it. Issues I presume like aggresively pursuing pensioners for income tax they never realised was owing due to HMRC coding f*** ups, whilst doing dodgy deals with Starbucks & Amazon to help them keep more of their profits!

 

As you say, The fuel boats can do it & pointedly taking your custom elsewhere is the only solution that is going to change this lazy practice, but anyway, I'm hopeing it will die away now that HMRC has clarified the situation.

[matty40s]

Are you saying that the marinas who impose a 60/40 split make a higher profit on diesel sales than if they sold at 80/20?

 

 

Ian.

 

A marina that declares a compulsory split (ie 60/40) and then takes your money with no paperwork could well be commiting fraud by pocketing the duty element and then stating 100% domestic to HMRC.

I have been to two marinas recently that didn't require me to sign any paperwork, I have also been to Wheaton Aston who has a comprehensive spreasheet with all previous customer boats/owners and splits declared......and I had to sign for the declaration I made.

If I were HMRC, I would be looking at the marinas where 100% domestic is declared as standard rather than try to chase a boater or two around.

 

For the record, I declare a split of 70/30 or 50/50 in Summer,and 10/90 in winter as a rule.

[alan_fincher]

Sorry Alan, and I've discussed this very point with my brother, technically it IS illegal for a supplier to impose 60/40 in this situation where its the purchaser's responsibility, in law, for the declaration.

 

I can't speak for what others have been told by HMRC, but its entirely likely their enquiry has been misinterpreted by the official concerned. Unless they have spoken to someone directly involved with VAT in this area, they are unlikely to be given the proper information by an ordinary HMRC employee.

I don't understand why you mention "someone involved with VAT", because it isn't VAT we are talking about here, it is the fuel duty, (the VAT being the same reduced 5% rate on propulsion fuel as on fuel not used for propulsion).

 

I appreciate that people have received different responses about this, but there are certainly in the public domain written responses to what I would consider well phrased questions to HMRC which say the resellers are not acting illegally.

 

It seems to me if someone has contacted HMRC in good faith, and received a written reply from someone representing HMRC, you can't take it a lot further than that.

 

Most people will not then write to them again, in the hope it produces a different answer, will they?

[johnmck]

Hi. We always refer to Sue's blog in sourcing diesel ( N.B. Retirement with no problem)

 

http://www.noproblem.org.uk/blog/links/diesel_split.htm

 

[Dave_P]

Hi All,

 

We are going into the water this week for the first time..very exciting! but we will need to get some diesel in her.

Am I right in assuming we can use red diesel, so long as its for heating? - If this is the case, how much should it be roughly?

There are facilities in the marina, but is it cheaper to go to a fuel merchant place?

 

Thanks

 

Toby.

 

Last time I was buying diesel at Wheaton Aston, I had a nosey at the splits being declared by previous customers (they keep it all on a list) and they varied between 100% red to 40% red / 60% white. This is going to make a big difference to the price. 100% red will cost around 78p per litre somewhere cheap. You could be paying £1.30 a litre on a 40/60 split.

 

To be on the right side of the law, you need to be able to justify what you've bought. If you have a permanent mooring and NEVER move your boat, you should be ok on 100% split. If you continuously cruise, you'll need a very convincing reason for doing the same if HMRC comes knocking. Perhaps you have a pedalo system installed in your boat and propel yourself that way?

 

The question is, what is the likelihood of HMRC checking up on you? On past evidence - practically zero. I'm sure that makes it tempting for some to declare 100% red to save a few bob. For myself, I always declare a split, even if it's small. Then I feel a bit better about not risking being prosecuted for tax evasion.

 

A marina that declares a compulsory split (ie 60/40) and then takes your money with no paperwork could well be commiting fraud by pocketing the duty element and then stating 100% domestic to HMRC.

I have been to two marinas recently that didn't require me to sign any paperwork, I have also been to Wheaton Aston who has a comprehensive spreasheet with all previous customer boats/owners and splits declared......and I had to sign for the declaration I made.

If I were HMRC, I would be looking at the marinas where 100% domestic is declared as standard rather than try to chase a boater or two around.

 

Good point. I'd always assumed that the 60/40 splitters simply didn't understand how the system worked and were scared that they could be prosecuted for selling anything else. Unlikely as that sounds.

 

To be honest, I'd rather HMRC didn't look at anything to do with the canals, marinas or otherwise. I can only see it leading to unforeseen and unwanted issues. As it is, I simply don't buy from anyone who enforces a split on me.

Edited November 27, 2012 by Dave_P

[BargeeSpud]

I don't understand why you mention "someone involved with VAT", because it isn't VAT we are talking about here, it is the fuel duty, (the VAT being the same reduced 5% rate on propulsion fuel as on fuel not used for propulsion).

 

I stand corrected then. But I don't see the difference, as its still the same principle be it VAT or Fuel Duty. The person responsible for determining the duty rates payable is still the purchaser, not the seller. As for the legality, I still believe that, technically, its illegal to enforce a duty rate that is not yours to determine. As with all instances relating to the infringment of tax laws, its entirely up to HMRC to decide which infractions of tax laws they feel obliged to pursue. I expect that in the case of fuel duty, they probably see that those marinas that enforce a strict 60/40 policy means the revenue raised works in their favour, so unless they get inundated with complaints on a national scale, they're not inclined to do anything to upset their revenue stream. You can bet your life that if they thought the exchequer were losing out, they'd clamp down hard.

[ditchcrawler]

 

 

To be honest, I'd rather HMRC didn't look at anything to do with the canals, marinas or otherwise. I can only see it leading to unforeseen and unwanted issues. As it is, I simply don't buy from anyone who enforces a split on me.

Have a greenie for that bit

[BargeeSpud]

Have a greenie for that bit

And one from me too, I didn't see that earlier.

 

Good point. I'd always assumed that the 60/40 splitters simply didn't understand how the system worked and were scared that they could be prosecuted for selling anything else. Unlikely as that sounds.

No, they can't be prosecuted, in the situation you outline, because there wouldn't be any proof of wrong doing as they got the information of the split from the purchaser. HMRC wouldn't pursue the seller, they'd pursue the purchaser which is why its sensible to record all your propulsion/domestic hours of use, along with your diesel purchases, in case the taxman cometh.

Edited November 27, 2012 by Spuds

[Dave_P]

Taxman: Could you show us your fuel purchasing records for the last 5 years.

 

Boater: No. I haven't kept any.

 

Taxman: Why?

 

Boater: Didn't think it mattered.

 

Taxman: Why?

 

Boater: I only use red-diesel.

 

Taxman: Do you move this boat ever?

 

Boater: No.

 

Taxman: We've been spying on your boat for the last five years and we have proof that you've been all over the place.

 

Boater: Oh yeah. I forgot.

 

Taxman: So why haven't you used white diesel when travelling?

 

Boater: Oh I did. I carried diesel back from petrol stations in a jerry-can to cover my propulsion costs. And I paid cash.

 

Taxman: Er.....

[BargeeSpud]

Taxman: Could you show us your fuel purchasing records for the last 5 years.

 

Boater: No. I haven't kept any.

 

Taxman: Why?

 

Boater: Didn't think it mattered.

 

Taxman: Why?

 

Boater: I only use red-diesel.

 

Taxman: Do you move this boat ever?

 

Boater: No.

 

Taxman: We've been spying on your boat for the last five years and we have proof that you've been all over the place.

 

Boater: Oh yeah. I forgot.

 

Taxman: So why haven't you used white diesel when travelling?

 

Boater: Oh I did. I carried diesel back from petrol stations in a jerry-can to cover my propulsion costs. And I paid cash.

 

Taxman: Er.....proove it

 

Brilliant! Have a greenie. Oh if only we could get away with it. Besides, I only said it was sensible! It wasn't meant to be instructive.

 

Note: My highlight BTW.

Edited November 27, 2012 by Spuds