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HM Revenue and Customs Brief 35/09

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HM Revenue and Customs -Tax Authorities

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issued 28 July 2009

Use of rebated fuel in grass cutting vehicles

This brief is intended to help users of diesel fuelled grass cutting vehicles, such as local authorities, golf course operators and ground staff to decide whether the vehicle should be run on red or white diesel.

Schedule 1 of the Hydrocarbons Oil Duties Act 1979 lists the categories of excepted vehicle. Excepted vehicles are those which are entitled to use rebated fuel. The three categories which vehicles undertaking grass cutting work could fit into are:

  • unlicensed vehicles not used on public roads
  • tractors
  • mowing machines

Unlicensed vehicles not used on public roads

A vehicle that is not used on the public road and has no license under the Vehicle Excise and Registration Act 1994 is an excepted vehicle. If a vehicle has become untaxed since 31 January 1998 it requires a Statutory Off-Road Notification (SORN). Such vehicles are eligible to use red diesel if a SORN declaration has been made. Unlicensed vehicles that do not require a SORN will continue to be able to use red diesel without a SORN declaration if kept off-road. Consequently a tractor, mower or utility vehicle used for grass cutting which never goes on the public road can be fuelled on red diesel.

Tractors

To qualify in the ‘Tractors’ excepted vehicle category the vehicle must be an agricultural tractor which the legislation defines as one that:

(a) is designed and constructed primarily for use otherwise than on roads, and
(b) is used on public roads solely for:

(i) purposes relating to agriculture, horticulture or forestry
(ii) cutting verges bordering public roads
(iii) cutting hedges or trees bordering public roads or bordering verges which border public roads

The explanatory memorandum that accompanied The Excepted Vehicles (Amendment of Schedule 1 to the Hydrocarbon Oil Duties Act 1979) Order 2007 stated that HMRC and industry representatives would establish and publish a code of practice that defines which activities are (for the purposes of red diesel entitlement) regarded as being agriculture, horticulture or forestry.

The resulting document was the Memorandum of Agreement signed in January 2008 by HMRC, the Driver and Vehicle Licensing Agency, the National Farmers’ Union, the National Association of Agricultural Contractors and the Confederation of Forest Industries.

The Memorandum states that landscaping and the maintenance of recreational facilities are not agriculture or horticulture. As a result a tractor cannot use red diesel when traveling on the public road to or from a job involving grass cutting/maintenance work at golf courses, playing fields, parks, cemeteries or other grassed areas of this type. A tractor can however undertake grass management work when the grass is being cultivated for harvesting as fodder and the legislation specifically permits the cutting of grass verges that border public roads.

Mowing machines

The mowing machine excepted vehicle category does not place limitations on what the mower can do. Consequently any vehicle which is a purpose built mower used exclusively for mowing qualifies to use red diesel regardless of the type of grass cutting it undertakes or its use of the public road. A tractor with mowing equipment attached is not however a purpose built mower. It does not therefore qualify in the mowing machine category and only qualifies in the tractors category when undertaking qualifying work.

Any type of utility vehicle with removable mowing machinery is not a purpose built mower. However a vehicle consisting for example of a Land Rover chassis with permanently fixed grass cutters, designed and constructed for grass cutting and used solely for that purpose, would qualify in the mower category.

Advice

If you have any doubt about whether or not your vehicle or activity qualifies, please contact the National Advice Service on Tel 0845 010 9000.


About the Author

© Crown Copyright 2009.

A licence is need to reproduce this article and has been republished for educational / informational purposes only. Article reproduced by permission of HM Revenue & Customs under the terms of a Click-Use Licence. Tax briefs are updated regularly and may be out of date at time of reading.



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Article Published/Sorted/Amended on Scopulus 2009-08-08 00:35:40 in Tax Articles

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