Red Diesel Questions and Answers
- What is red diesel?
- Who can use red diesel?
- Is red diesel really red?
- Where can I buy red diesel from?
- What is the latest red diesel price?
- Is it illegal to use red diesel?
- Who can use red diesel after April 2022?
- Is red diesel known by any alternative names?
- Why is red diesel cheaper than white road diesel?
- Do you need a licence to buy red diesel?
- What is red diesel used for?
- Can red diesel be used for heating businesses?
- Which vehicles can use red diesel?
- Is red diesel illegal to use on public roads?
- Can red diesel be used to grit public roads?
- Can tractors gritting public roads use red diesel?
- Will using red diesel damage my car?
- Can the red dye be removed from red diesel?
- What is the history of red diesel?
- Does EU law treat red diesel differently?
What is red diesel?
Red diesel is a standard mineral diesel that has been blended with a red dye to mark its lower duty rate. The dye and the contained chemical markers don’t alter the usability or function of the fuel.
As red diesel is a rebated fuel, it’s taxed at a lower rate than the standard white diesel available at petrol filling stations up and down the country.
It’s illegal to use red diesel in vehicles on public roads (although there are some exceptions such as when gritting roads). Gas oil is legal in most off-road vehicles, machinery and commercial heating systems.
Who can use red diesel?
The UK government removed the entitlement to use red diesel for many sectors after April 2022. This means many businesses have to use fuel that’s taxed at the standard rate for road diesel (DERV).
Red diesel and rebated fuel entitlement is now restricted to the following purposes:
- Rail transport
- Community amateur sports clubs and golf courses
- Sailing, boating and marine transport (excluding private pleasure craft in Northern Ireland)
- Travelling fairs and circuses
- Fuel used for non-commercial purposes – electricity generation and heating
- Agriculture, horticulture, fish farming and forestry
The change in legislation is designed to encourage users to switch to low-emission fuels; the higher the cost of diesel, the greater the motivation to improve energy efficiency and choose cleaner alternatives.
Read more about the 2021 Budget.
Is red diesel really red?
Yes – red diesel is actually red.
This is because a red dye and several chemical markers are added to the fuel before it’s sold, giving it a deep crimson colour that differentiates it from white or road diesel.
The dye in red diesel acts as a marker for HMRC inspectors, helping them identify where the rebated fuel has been used. The dye stains the interior of the tank, fuel lines and even the engine; the dye is harmless, and won’t negatively affect generators or engines. It is simply there to help HMRC enforce the law and to prosecute fuel fraud where red diesel has been used illegally.
Where can I buy red diesel from?
Red diesel is not for general sale or for use on public roads in the majority of cases. You will need to go to a specialist fuel supplier in order to purchase red diesel legally.
Nationwide Fuels is a reliable fuel supplier, delivering red diesel and other liquid fuels and oils across the UK. We even operate an emergency fuel delivery service, ensuring your delivery is only ever a few hours away if you’re ever caught short.
We can deliver red diesel in any quantity from 500 litres right up to 36,000 litres or more if you need it! If you don’t have suitable fuel storage for your red diesel delivery, we can also supply red diesel in 205-litre barrels or even provide you with a new fuel tank.
If you’d like to discuss your own needs and requirements with our red diesel experts, give us a call today on 0330 678 0880.
What is the latest red diesel price?
The price of red diesel changes regularly due to outside factors that are beyond your (or our) control.
However, as we purchase our stock at wholesale prices, we’re able to pass on savings to our customers, no matter how much fuel you need.
We will always give you our best price, so call our red diesel experts today on 0330 678 0880 for your tailored quote.
Is it illegal to use red diesel?
Red diesel isn’t an illegal product – if it were, we wouldn’t supply it.
However, red diesel is restricted to off-road use only and even then, only under certain conditions. Whilst there are certain rare exceptions that apply for using red diesel on public roads, these will not apply to 99% of use cases.
It is legal to use in off-road vehicles and machinery, provided that your industry has red diesel eligibility. It’s important to note that the list of approved sectors will be changing from April 2022, so you should check to ensure that you are able to continue using red diesel after then.
Who can use red diesel after April 2022?
In Budget 2020, the UK government announced that they would be changing the law around red diesel from April 2022.
Driven by the target of reducing the UK’s harmful greenhouse gas emissions, many sectors and industries will lose their red diesel eligibility, and will be left with only a few options:
- Switch to white diesel
- Switch to a renewable diesel alternative, such as HVO
- Electrify and decarbonise their operations
We explain these changes in more detail in a recent article about red diesel eligibility since 2022.
Is red diesel known by any alternative names?
Depending on who you speak to about red diesel, you will hear it called many different names. Technically, red diesel is an alternative name for the fuel’s original name – gas oil.
The name red diesel became common after 1961 when it became a requirement to add red dye and chemical markers to lower-taxed gas oil. Other names for red diesel include tractor diesel, 35-second oil, agricultural diesel, farm diesel, cherry red and generator diesel to name just a few.
Why is red diesel cheaper than white road diesel?
In short, red diesel is cheaper than road diesel because it has a lower rate of fuel duty applied to it.
Using red diesel on public roads is illegal and could lead to a fine, prosecution and a criminal record.
Do you need a licence to buy red diesel?
Although there are restrictions on its usage, you do not need a special licence to purchase red diesel, however, you will need to sign an RDCO form.
Companies that supply red diesel and any other controlled oil must be registered with HMRC. This category includes red diesel, and other flammable fuel oils such as kerosene, rebated bio blend and aviation turbine fuel.
As a fuel supplier, we also have a responsibility to ensure that red diesel and all other controlled oils we sell are going to be used for legitimate purposes. That’s why we require all customers to provide information that we then pass on to HMRC and subsequently, the Road Fuel Testing Units (RFTU).
Further information can be found on the HMRC website.
What is red diesel used for?
Red diesel is just like regular diesel but with the addition of red dye and chemical markers to help HMRC and the authorities to detect illegal use in road-going and exempt machinery.
If you do plan to use red diesel, you should be aware that there are restrictions on its use. You must ensure that you are eligible to use the red diesel in order to avoid any potential fines and prosecution.
Can red diesel be used for heating businesses?
Businesses lost access to red diesel for heating following an update to the law in April 2022. Instead, we recommend that our customers switch to industrial heating oil (IHO), a zero-VAT fuel used for heating purposes.
Please note: IHO is not to be used as fuel for a road vehicle, off-road vehicle, vessel or any other machinery that is not an excepted machine and is intended for heating purposes only.
Which vehicles can use red diesel?
Any vehicle, machine or generator that operates on regular diesel will be able to physically use red diesel as a fuel. That’s because red diesel and white/road diesel are essentially the same fuels, except for the addition of red dye and chemical markers in red diesel.
There are restrictions on who can make use of the fuel, however; any vehicle that uses public roads cannot use the rebated fuel except for a few rare exceptions.
Is red diesel illegal to use on public roads?
For the majority of use cases, filling a vehicle with red diesel with the intention of driving on public roads is illegal. This is considered to be tax evasion and penalties and fines will be imposed if caught.
You can read about the offences and penalties for using red diesel imposed by HMRC on the gov.uk website.
At the time of writing, farmers are able to use red diesel to travel between different plots of land so long as they are both owned by the same individual/business, up to a maximum distance of 1.5km. Some exceptions also exist for vehicles using red diesel for horticulture or forestry.
Can red diesel be used to grit public roads?
Yes, but only in vehicles that have been constructed or temporarily adapted for the sole use of gritting public roads to deal with frost, ice or snow. Then there is no restriction in its purpose so long as this is all the vehicle is used for.
There are also exceptions for farmers who use red diesel in tractors or other farm vehicles when gritting roads.
You can learn more here on the gov.uk website.
Can tractors gritting public roads use red diesel?
Since 1st November 2013, farmers have been allowed to use agricultural vehicles to grit the roads in order to clear them of frost, ice and snow. The rules were changed as it was considered to be problematic for farmers to switch between red diesel and white diesel when gritting public roads.
The issue for many rural roads and villages is that they weren’t high-priority gritting areas for many municipal gritting authorities. This left many rural locations cut off by ice and snow on the roads until farmers were able to get their tractors onto the roads.
You can learn more here on the (1) gov.uk website and (2) gov.uk website.
Will using red diesel damage my car?
If your car was manufactured to use regular road diesel then red diesel wouldn’t damage your car.
However, using red diesel on public roads is illegal and could result in you being prosecuted by HMRC.
You can learn more here on the gov.uk website.
Can the red dye be removed from red diesel?
Yes, it is possible to remove the dye from red diesel. This process is known as fuel laundering and is illegal.
What is the history of red diesel?
1921 – Until 1921, Customs Duty was charged on imports of motor spirits. On 1/1/1921 this was abolished and replaced with excise duty and vehicle licenses.
Fire engines kept by local authorities, ambulances and road rollers were exempt. Rates applied to different vehicles appeared to have been assessed on likely damage done to roads.
Diesel fuel was cheap as it was not considered to be a road fuel – cars and other road vehicles tended to run on petrol. Subsequently, the use of diesel in lorries, buses and other road vehicles grew.
1934 – In 1934, local authority road and gully cleansing vehicles were exempted from excise duty on licenses. Rates for off-road vehicles were reduced.
1935 – Due to the growth in the number of diesel-powered road vehicles, it was recognised that a separate rate for ‘off-road’ vehicles was needed. From 1935, road vehicles were forbidden to use rebated fuels – and penalties for misuse were introduced to ensure equality between petrol and diesel road vehicles.
Off-road vehicles, including railways, benefited from the lower rate, thus incentivising rail transport over road transport. This is probably where today’s concessions for rebated fuels originate.
The categories and uses of vehicles permitted to use rebated fuel were gradually added over the years to reflect the changes in machinery used and the amount of road use.
1947 – Mobile cranes used only on roads as cranes were given a reduction in excise duty.
1949 – Tractors and agricultural machinery, trench digging vehicles on public roads not hauling any load were given special rates.
1950 – The concession was extended to vehicles operating in woodland and to vehicles operating within fifteen miles of farms or woodland that were engaged in hauling between farms and/or estates.
1952 – Legislation expressly stated that no road vehicles, other road rollers and other specifically exempted vehicles, were entitled to use rebated heavy oils.
The list of exempted vehicles included ploughing engines, tractors, agricultural engines, mechanical diggers, trenchers, mobile cranes and mowing machines.
1959 – The list of exempted vehicles was further extended to include vehicles used solely for conveying road construction equipment, as well as those passing from one part of land to another via roads.
Auxiliary engines on vehicles were also allowed to use rebated oil (as a result of lobbying especially by concrete lorry operators). Emphasis was placed on the fact that vehicles licensed as goods vehicles were not exempt.
It was around this time that marking was introduced to allow oil to be sent out at a rebated rate for these off-road and exempted vehicles, rather than requiring users to reclaim the duty paid.
With the growth in the number of eligible vehicles and the growing differential between the price of road fuel and rebated fuel, the introduction of marking allowed HMRC to identify rebated fuel and check for its use in road vehicles and ensured the administrative burden was kept to a minimum by allowing users to buy at the lower rate.
1961 – The use of red dye and chemical markers in all diesel fuel sold as red diesel became a requirement to help the authorities distinguish the low-duty fuel in vehicles used on public roads.
1960s – The list of exempted vehicles was further expanded and refined, adding snow ploughs and defining construction vehicles such as ‘works trucks’ and ‘dumper trucks’.
Schedule 1 to the Hydrocarbon Oils Duties Act 1979 (HODA) sets out the current list of ‘exempted vehicles’ (those that are allowed to use rebated fuels when using public roads in certain circumstances).
The marking requirements are set out in Regulation 18 of the Hydrocarbon Oil Regulations 1973 (Currently being updated to include the new ‘Euromarker’ to be introduced from 1 August 2002).
Does EU law treat red diesel differently?
Directive 92/81/EEC sets out a number of areas in which the Member States may apply reduced rates of excise duty:
- Article 8 (1) requires Member States to exempt certain uses of oils from harmonised excise duty. These are: fuels not used as motor or heating fuels, aviation fuels, fuels used in ships in Community waters, other than private pleasure craft and blast furnace fuels.
- Article 8(2) allows the Member States to apply reduced rates or exemptions in respect of electricity production, navigation of inland waterways, for passenger transport and freight, for pilot projects to develop environmentally friendly fuels, for development of aircraft and ships, for use in agriculture, horticulture and fisheries, and; for dredging.
- Article 8(3) allows Member States to apply reductions in excise duty on gas oil for vehicles intended for use off the public roadway and in respect of construction and public works vehicles.
Oils for such uses must either be released at full duty rate and the difference reclaimed by the end-user OR must be marked before release at the rebated rate. The introduction of the Euromarker means that all oil used in off-road and exempted vehicles must be marked with Solvent Yellow 124.
