Tax on Biofuels

Paying the right tax to use home made biofuels in your vehicle

If the idea of free or cheap green fuel appeals then you have probably considered using biodiesel (1), waste vegetable oil (2) (WVO) or straight vegetable oil in your vehicle. However life is never that simple.

Tax (excise duty) is payable on any fuel used to power any vehicle whether it is home-made biodiesel (3) or even if you want to pour vegetable oil from the supermarket into your tank. Currently the levels of tax per litre are:

Biodiesel	28.35p
non Road Fuel	3.13p
Bioethanol	28.35p

The excise duty for biofuels was set in the 2002 Budget at 20p per litre less than the duty on ultra low sulphur diesel (ULSD). A full list of hydrocarbon oil duty rates (4) is available here on the HM Revenue and Customs website.

Legal Requirements and Forms for Biofuel Producers

Producers of biodiesel (a definition which includes those that use WVO and SVO in their vehicles) must register with HM Revenue and Customs using form EX103. Detailed records and receipts must then be kept of biofuel use and submitted using form HO930 which will be sent out to you each month.
If you are a private individual and not a company make sure you obtain the EX103 and not the EX103A.

When you have completed your EX103 send it to: HMCE, Mineral Oils Relief Centre, Dobson House, Regent Centre, Gosforth, Newcastle-on-Tyne NE3 3PF. If you are unsure of how to fill in your monthly HO930 declaration then obtain the 179E leaflet from HM Customs and Excise or view Notice 179E - Biofuels and Other Fuel Substrates (5) online here.

179E also lists conditions which must be met by the fuel for it to be eligible for the reduced duty rate - for example, biodiesel made with a recipe including hydrocarbons such as white spirit or kerosene is not eligible.

Some very useful information on filling in the EX103 and HO930 forms (particularly if you will be using vegetable oil is available in this article: Vegetable Oil as Vehicle Fuel (6).

Contacting HM Customs and Excise

If you would like to request forms and ask advice then HM Customs and Excise have a national enquiries help line open from 8am-8pm Monday to Friday. Call 0845 010 9000 or 020 8929 0152 if you don't want to pay the premium cost of an 0845 number!
The HM Customs and Excise website (7) is here.

Obtaining Forms

Currently the EX103 and HO930 forms cannot be downloaded and printed off from the HM Customs and Excise website, however bio-power.co.uk have a Microsoft Word version of the EX103 Excise Entry: Private Trader form, and bitmap images of the front and reverse of the HO930 form which can be downloaded free of charge. Click here to download the EX103 and HO930 forms (8).

Web Link References

(1) http://www.reuk.co.uk/Introduction-to-Biodiesel.htm
(2) http://www.reuk.co.uk/Waste-Vegetable-Oil.htm
(3) http://www.reuk.co.uk/Biodiesel-Recipe
(4) http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageExcise_RatesCodesTools&propertyType=document&id=HMCE_PROD1_024961
(5) http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageExcise_ShowContent&id=HMCE_CL_000205&propertyType=document#downloadopt
(6) http://www.ravenfamily.org/andyg/vegoil.htm
(7) http://customs.hmrc.gov.uk/
(8) http://www.bio-power.co.uk/download.htm