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HM Revenue and Customs Brief 46/11

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HM Revenue and Customs -Tax Authorities

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Issued 4 January 2012

Use of rebated fuel in grass cutting vehicles

In October 2011 HM Revenue & Customs (HMRC) conducted a review which considered whether there was scope for the extension of red diesel entitlement to vehicles undertaking certain community/charity activities. One aspect of community work considered was the use of tractors to perform grass cutting of rural communal land and recreation areas for no payment. The review concluded that there should be no change to the current rules but that guidance should be published to help those concerned to understand when it is permitted to use red diesel in vehicles that are being used to cut grass.

Schedule 1 of the Hydrocarbon Oil Duties Act 1979 lists the categories of an excepted vehicle. Excepted vehicles are those which are entitled to use rebated fuel. Vehicles which meet the requirements of one of the following categories can use red diesel for cutting grass:

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

The rules for qualification in each of these categories are explained in the following paragraphs.

Unlicensed vehicles not used on public roads

A vehicle that is not used on the public road and has no licence 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). A vehicle for which a SORN has been made is eligible to use red diesel. Unlicensed vehicles that do not require a SORN may also use red diesel so long as they are 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; or
(iii) cutting hedges or trees bordering public roads or bordering verges which border public roads.

In the view of HMRC, landscaping and the maintenance of recreational facilities are not agriculture, horticulture or forestry. This view is in accordance with 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, which defined the activities that qualify as being agriculture, horticulture or forestry. As a result, a tractor cannot use red diesel when travelling 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 a similar sort. However, a tractor can use red diesel to cut grass if the grass is being cultivated for harvesting as fodder or if it is growing on the verge of a public road.

Mowing machines

In HMRC's opinion 'mowing machine' means either a purpose-built mowing machine, or a vehicle which has been permanently adapted for the sole purpose of mowing. A tractor with mowing equipment attached to it is not a mowing machine, nor is a utilty vehicle to which mowing machinery can be temporarily attached. However, a vehicle consisting, for example, of a Land Rover chassis with permanently fixed grass cutters, designed and constructed for cutting grass and suitable solely for that purpose, would qualify in the mowing machine category.

Summary

To summarise, rebated fuel can only be used to perform grass cutting where:

the vehicle is unlicensed and never uses the public road,

or

the vehicle is designed and constructed primarily for use other than on roads and the grass being cut is being cultivated as animal fodder or grows on the verge of a public road,

or

the vehicle is either a purpose-built mowing machine, or a vehicle which has been permanently adapted for the sole purpose of mowing.

A vehicle not included in the above descriptions is not eligible to use red diesel for cutting grass.

Advice

If you have any doubt about whether your vehicle qualifies to use red diesel, please phone the Excise and Customs Helpline on 0845 010 9000.


About the Author

Crown Copyright 2012.

A licence is needed to reproduce this article and has been republished for educational / informational purposes only. Article reproduced by permission of HM Revenue & Customs.



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Article Published/Sorted/Amended on Scopulus 2012-01-07 13:24:16 in Tax Articles

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