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HM Revenue and Customs Brief 07/14


HM Revenue and Customs -Tax Authorities

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Issued 03 February 2014

Excise duty: Registered Dealers in Controlled Oils Scheme (RDCO)

Purpose of this brief

This brief gives information about changes to the RDCO scheme, in particular changes to the approval process and the obligations of the RDCO.

Who needs to read this?

Anyone who handles, sells or deals, or intends to handle, sell or deal in controlled oils.


The RDCO scheme supports the UK Oils Strategy with the aim of identifying and tackling commercial oils fraud. Our aim under the scheme is to work in partnership with honest distributors to improve our control of the supply chain for controlled oils and to protect the legitimate trade.

Controlled oils are defined as:

  • marked rebated gas oil (red diesel) including ultra low sulphur gas oil
  • marked rebated kerosene (paraffin, burning oil, etc.), and
  • aviation turbine fuel (Avtur)

Important aspects of the RDCO scheme are the approval process and the obligations of the RDCO. It is essential that HMRC have robust systems in place to ensure only legitimate businesses are authorised to deal in controlled oil, and that businesses understand their obligations under the scheme.

What are the changes?

The approval process has been updated to include a fit and proper test which HMRC will apply to determine whether a person is responsible and qualified to hold an approval to deal in controlled oils. There is also a new requirement to submit a business plan which should accompany the RDCO application form. See Section 4 of Notice 192 for further details.

Changes have also been made to the obligations placed upon the RDCO (previously called duty of care). These changes have been made to clarify the legitimate uses which controlled oil can be put to and to reinforce the RDCO's obligations when supplying controlled oil, including marketing of controlled oils and the appropriate detail on delivery notes. See section 5 of N192 for further details.
In addition, changes to Section 8 have been made to clarify the action we will take in respect of non-compliance with the scheme.

We have also made several minor changes to the notice to improve readability.

Who will be affected?

The change will affect anyone who requires approval as an RDCO and also existing RDCOs who notify us of significant changes in their business.

Why are these changes being made?

HMRC recently reviewed the UK Oils Strategy and recommendations were made to introduce improvements which would enhance our control of the RDCO scheme.

What legislation is being changed or introduced?

There are no changes to existing legislation and no new legislation is being introduced.


The changes come into effect on 01 February 2014.

Further Guidance

Further information relating to the RDCO scheme can be found in:
HMRC Notice 192: Registered Dealers in Controlled Oil Scheme

About the Author

Crown Copyright 2014.

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 2014-02-05 10:11:21 in Tax Articles

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