Jump to content

Tax on propulsion diesel


frahkn

Featured Posts

 

I could tell you who the last one is as well!

I think I can too :)

The attitude of boatyards and marinas also varies enormously. I have met:

 

"60/40 split? Fine. Sign here."

 

"60/40? Everybody round here is 20/80."

 

"How are you paying? Cash?"

 

"You don't want to buy it here. We charge full price only"

 

"That was all in cans, wasn't it? Basic price then." (20 litres of 60 was in a can)

 

"Basic price for your can. What declaration on the rest?"

 

"Can't be bothered with all that paperwork. That's 70p a litre."

 

"Cans make no difference. All 60/40 here"

 

And other variations in between.

 

Sometimes with no paperwork at all.

Had most of those at some time or other.

Link to comment
Share on other sites

I suspect that at the moment it's pretty well a free for all. If all boaters declared 10% propulsion only I very much doubt that anything would change. Does the government have have the time and inclination to get into disputes with boaters over what is, in the scheme of things, a tiny sum? I very much doubt it.

 

No, but the Government does have to satisfy the EU that it is charging duty on propulsion fuel in accordance with EU law, so too lax an attitude could undermine the Government's position that split charging is legitimate.

  • Greenie 1
Link to comment
Share on other sites

 

No, but the Government does have to satisfy the EU that it is charging duty on propulsion fuel in accordance with EU law, so too lax an attitude could undermine the Government's position that split charging is legitimate

Personally, I don't see why boats should have to use derv, which stands for "Diesel Engined Road Vehicle. Yet again, the eu poking its nose into our domestic affairs.

Link to comment
Share on other sites

Personally, I don't see why boats should have to use derv, which stands for "Diesel Engined Road Vehicle. Yet again, the eu poking its nose into our domestic affairs.

We have been here many times. I would like to say that I agree, but can't find a good argument against paying full price for propulsion use. I can find a good one for heating etc.

Very different for legitimate working boats.

Link to comment
Share on other sites

We have been here many times. I would like to say that I agree, but can't find a good argument against paying full price for propulsion use. I can find a good one for heating etc.

Very different for legitimate working boats.

We HAVE been here many times before, and when all other leisure off road users of diesel also have to pay full price for their diesel I will agree with you.

 

Until then I will continue to stress that boaters are being unfairly picked out for special treatment.

 

George ex nb Alton retired

Link to comment
Share on other sites

We HAVE been here many times before, and when all other leisure off road users of diesel also have to pay full price for their diesel I will agree with you.

 

Until then I will continue to stress that boaters are being unfairly picked out for special treatment.

 

George ex nb Alton retired

True enough. If boats must pay, then so should all leisure use. No argument from me on that one.

Can you make a good argument for not paying full price for propulsion though for boating? That is the issue; an argument we must produce.

Link to comment
Share on other sites

Some thoughts based on the conversations I and others had with HMRC on NABO's behalf in the past: sure, some of this may have been said before but....

 

The base cost of diesel is based on the commercial price your outlet sells for. That depends on on all the usual things, how much they buy, how often, what deals they have with their supplier, how much mark up they chose to add on.....

 

Red diesel is a different product technically to road derv/'heavy oil' so there is a variation in price there anyway. Further variations can occur where some marinas/yards buy a variant without a biofuel content, (in my experince the base price is higher).

 

The fuel duty is then added: when used for transportation/road use is 57.95p /litre. For non road use it drops to 10.70 p /litre:

https://www.gov.uk/guidance/fuel-duty

 

Include VAT and you get to the approx 50p per litre difference cited by previous posters.

 

The self declaration was a compromise agreed by HMRC but one not obligatory on suppliers. EU are tetchy about it but the amount we leisure boaters use is so small compared to industrial and other commercial usages that it is thought that it is unlikely to be deemed worthy of close scrutiny.

 

60/40 split was indeed what HMRC felt was a good/fair average for typical use based on data and submissions from the boating groups at the time. It was in effect agreed that if sales returns where coming back showing that sort of split in the duty overall it would not be questioned unless there was exceptional cause to do so. In effect if dealers returns are showing significant variations from that average they are more likely to be questioned and their records checked etc.... That is where the self declaration stuff comes in - it gives a the dealer and in turn HMRC a paper trail to justify if their fuel duty returns are at variance from the 60/40.

 

Some yards simply save paperwork and sell all at 60/40. Others collect returns case by case; arguably this is the correct way to do it! Others take a conservative view and will as per examples above allow less percentage for domestic use, to be on the safe side.

 

Compare to parts of Europe where you have to have a seperate tank in your boat for non propulsion use if you want to buy at all with reduced duty.

 

Wot Dave Mack said above: If we take the pixx with our declarations it is more likely that EU will get more twitchy.

Link to comment
Share on other sites

True enough. If boats must pay, then so should all leisure use. No argument from me on that one.

Can you make a good argument for not paying full price for propulsion though for boating? That is the issue; an argument we must produce.

You have turned the argument on its head.

 

It is up to HMRC and the EU to prove why boats should be singled out for special treatment, not the other way round.

 

When I visit a vintage show, the tractors that arrive on trailers run on red. Only those which arrive on their own wheels using roads repairable at public expense are required to use white diesel. That on its own, rather demonstrates what the additional tax on white diesel is meant to cover, even if there is no actual hypothecation of taxation.

 

George ex nb Alton retired

Link to comment
Share on other sites

You have turned the argument on its head. Yes

 

It is up to HMRC and the EU to prove why boats should be singled out for special treatment, not the other way round. Agree, but if/when they do, we need a counter argument in place.

 

When I visit a vintage show, the tractors that arrive on trailers run on red. Only those which arrive on their own wheels using roads repairable at public expense are required to use white diesel. That on its own, rather demonstrates what the additional tax on white diesel is meant to cover, even if there is no actual hypothecation of taxation. Whilst I take your point, I doubt if that argument on its own is enough frankly. We need to come up with something better.

 

George ex nb Alton retired

Link to comment
Share on other sites

I suspect that at the moment it's pretty well a free for all. If all boaters declared 10% propulsion only I very much doubt that anything would change. Does the government have have the time and inclination to get into disputes with boaters over what is, in the scheme of things, a tiny sum? I very much doubt it.

I agree. Stop worrying about percentages and enjoy the boating.

Can anyone explain how the taxman could prosecute if he states boaters need not keep records. If I fill up with a declaration of 10% propulsion and then pop into Tesco canal side and add x amount of litres at full duty. how can it be worked out my use. I don`t have to keep records so have no reciept from Tesco.

It`s just not gonna happen. Anyone says it will is scaremongering.

Link to comment
Share on other sites

 

 

I still don't get it. Who are you to define a 'necessary' profit? Do you have access to their trading and profit and loss accounts?

 

How much profit on fuel sales is 'necessary' in your opinion for a business proprietor who has invested say, £2m in stock, equipment, fitting out the site etc and has to shell out perhaps a further £100k a year in rent, business rates, wages and other fixed overheads?

I agree what your saying having been self employed. A lot of folk don`t realise the extras in the background and think as he bought the fuel at say 50 and wants 95 for it he is cheating the customer.

The choice folk have and i`m sure you do it is look for the seller who accepts a lower profit and therefore a cheaper price to the buyer.

Link to comment
Share on other sites

I agree what your saying having been self employed. A lot of folk don`t realise the extras in the background and think as he bought the fuel at say 50 and wants 95 for it he is cheating the customer.

The choice folk have and i`m sure you do it is look for the seller who accepts a lower profit and therefore a cheaper price to the buyer.

I was once self employed, and whilst I agree with your sentiments from a sellers point of view, I always without exception used the cheapest wholesaler.

Link to comment
Share on other sites

I was once self employed, and whilst I agree with your sentiments from a sellers point of view, I always without exception used the cheapest wholesaler.

 

 

I bet if you ran a boatyard and your diesel stocks had run down to nothing, you'd buy more stock from a wholesaler who could deliver tomorrow than one who was 1p cheaper but delivery available in a month's time.

 

The price is never the only consideration!

 

Or how about another example. Wholesaler No 1 offers you diesel at 49p a litre. You have to buy 20,000 litres and pay in cleared funds before unloading. Wholesaler No 2 offers you diesel at 50p a litre, no minimum order and 90 days' credit. I'd probably buy from wholesaler No 2...

Link to comment
Share on other sites

 

 

I bet if you ran a boatyard and your diesel stocks had run down to nothing, you'd buy more stock from a wholesaler who could deliver tomorrow than one who was 1p cheaper but delivery available in a month's time.

 

The price is never the only consideration!

 

Or how about another example. Wholesaler No 1 offers you diesel at 49p a litre. You have to buy 20,000 litres and pay in cleared funds before unloading. Wholesaler No 2 offers you diesel at 50p a litre, no minimum order and 90 days' credit. I'd probably buy from wholesaler No 2...

If I ran a boatyard my stocks would be maintained at a good level.

The business I was in was always 90 days credit, couldn't have operated any differently. The secret was finding the cheapest but with 90 days credit. That was some years ago, but there was plenty of competition all too ready to meet demand.

Link to comment
Share on other sites

We have been here many times. I would like to say that I agree, but can't find a good argument against paying full price for propulsion use. I can find a good one for heating etc.

Very different for legitimate working boats.

My argument would be that rebated fuel has traditionally been used for all uses other than for road going vehicles. Tractors, generators, fridge units on lorries, you name it. That is why white diesel is known as DERV. For decades it was a tax on road going vehicles only, designed to defray the cost or wear and tear to the road network.

 

Narrowboats are taxed in a different way, and in fact I pay more for the waterways licence for my 41' boat than I do in excise duty for my 44 tonne articulated lorry. There is no logical reason why a road tax should be applied to a waterborne vessel, it is simply a directive from a political organisation which neither understands or respects our traditions but which simply wants to turn several dozen countries, all with their own traditions and histories into one great mass of grey Plasticine.

Link to comment
Share on other sites

My argument would be that rebated fuel has traditionally been used for all uses other than for road going vehicles. Tractors, generators, fridge units on lorries, you name it. That is why white diesel is known as DERV. For decades it was a tax on road going vehicles only, designed to defray the cost or wear and tear to the road network.

 

Narrowboats are taxed in a different way, and in fact I pay more for the waterways licence for my 41' boat than I do in excise duty for my 44 tonne articulated lorry. There is no logical reason why a road tax should be applied to a waterborne vessel, it is simply a directive from a political organisation which neither understands or respects our traditions but which simply wants to turn several dozen countries, all with their own traditions and histories into one great mass of grey Plasticine.

That would be a valid argument if we had not joined the EU. Since many other member countries do pay the higher duty on diesel for marine use, we are being ordered to do likewise. Of course I always paid full price for my petrol powered boats. I don't like having to pay extra, but unless a really good argument can be constructed, we need to get used to the idea.

"We have always done it like that" just doesn't cut it. We need a more convincing argument, but I can't think of one.

edited to add I agree it is illogical.

Edited by Guest
Link to comment
Share on other sites

Just out of interest does anyone know of an app or calculator for us boaters? Sometimes I see a price for 60/40 one place and then further along a base price... Be so nice to tap in some numbers and the maths to be done for me.

Link to comment
Share on other sites

That will be because of the volumes fuel stations sell relative to boatyard's. My local supermarket must have 30 pumps, yet you still have to queue for them. I can't ever recall having to queue for fuel in the boat.

Queues are not uncommon at Turner's Garage on the Shroppie at Wheaton Aston. Last week the base price was 56p/L and you are free to declare whatever you wish.

Link to comment
Share on other sites

Queues are not uncommon at Turner's Garage on the Shroppie at Wheaton Aston. Last week the base price was 56p/L and you are free to declare whatever you wish.

I will be queuing there in a day or two :)

Link to comment
Share on other sites

I believe the 60/40 split was mearly an example givern by HMRC, when this all first came into being.

It's now being taken as "gospel" by every one!

If you take how much of your engine HP/KW is actually passed into the water, via the propeller, a split of 10/90 is probably realistically accurate.

 

30HP engine at just above tick over produces what 10HP?

How much of that 10HP is used to turn the alternator, water pump, lost in heat through the skin tank?

How efficient is a propeller at transferring power?

Comments please.

 

Bod

When we were full time liveaboard ccers I fitted an hour counter to the gearbox to give us a reasonable figure for cruising, it usually worked out between 10/90 and 20/80. When we did a marathon 22 day cruise from Skipton to Devizes the split worked out at around 60/40.

 

A fast tick over drops our revs by the same amount whether we excite our large alt on max output or engage the prop. Alt absorbs approx 6 bhp on full output.

Edited by nb Innisfree
Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Recently Browsing   0 members

    • No registered users viewing this page.
×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.