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HMRC internal manual

Hydrocarbon Oils Strategy

From
HM Revenue & Customs
Updated
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Tied Oils: Waste Tied Oil: recording of transactions and procedures

Decide whether the substance is a waste tied oil or a waste product. This must be ascertained with the trader, taking into account the components ie what the oil has been mixed with, what effect this has on the oil, what the end product is, and whether or not it can still be used as an oil.

The following scenarios demonstrate how the oil travels within the scheme and how each transaction should be recorded on the HO34.

 

Waste tied oil sold in containers of 210 litres or less

The initial amount of tied oil delivered to process is recorded in box 10. After process the waste oil goes back into storage and is shown in box 5. When it is sold in containers of 210 litres or less the amount distributed is entered in box 8.

Waste tied oil sold in bulk to an approved person

The initial amount of tied oil delivered to process is recorded in box 10. After process the waste oil goes back into storage and is shown in box 5. When it is sold in bulk the amount distributed is entered in box 7.

Waste tied oil delivered to a duty suspended warehouse in lieu of destruction and not returned

Amounts must be entered into box 15 and there is no further action recording the quantities on the return form.

Waste tied oil delivered to a duty suspended warehouse and not returned

The initial amount of tied oil delivered to process is recorded in box 10. After process the waste oil goes back to storage and is shown in box 5. When it is delivered to the warehouse, amounts are shown in box 7 as being delivered to approved persons.

Waste tied oil delivered to a duty suspended warehouse, laundered and returned to original trader (waste oil remains trader’s property at all times)

Initial amount of tied oil delivered to process is recorded in box 10. When oil is sent for laundering it remains the property of the trader, so it does not need to be shown as distributed, but the warehouse must be shown on the trader’s approval certificate as a storage address. When returned from laundering it is shown in box 5 as returned to stock.

Waste tied oil delivered to a warehouse, laundered and returned to original trader (waste oil does not remain the property of the original trader during this process).

Amounts must be entered into box 15 as oil leaves the scheme. Quantities returned to the original trader for further use are then entered in box 4 as incoming stock.

Waste tied oil delivered to non-approved premises and retained there

The waste tied oil is considered to have left the scheme. Amounts must be entered into box 5 and then into box 11, diverted to ineligible use. Duty must be accounted for on a form W50 for the amounts involved. These are to be submitted with payment to the National Warrants Centre in Edinburgh.

Waste tied oil delivered to an approved person, laundered and returned to the original trader (waste oil remains original trader’s property at all times)

Initial amount of tied oil delivered to process is recorded in box 10. When oil is sent for laundering it remains the property of the trader, so it does not need to be shown as distributed, but the laundering premises must be shown on the trader’s approval certificate as a storage address. When returned from laundering, amounts are shown in box 5 as being returned to stock.

Waste tied oil delivered to an approved person, laundered and returned to the original trader (waste oil does not remain the property of the original trader during this process)

The initial amount of tied oil delivered to process is recorded in box 10. After process the quantity of waste oil to be sent for laundering should then be shown in box 5 returned to stock. When oil is sent for laundering the amount involved is entered to either box 7 or 8 depending on the container size. Quantities returned to original trader for further use are entered into box 2 as incoming stock.

Waste oil delivered to unapproved premises, laundered and returned to the original trader (waste oil remains the property of original trader at all times)

As waste oil remains the property of the original trader at all times, the premises where laundering takes place must be shown on traders approval as a storage premises. Amounts involved are entered to box 5 when oil is returned from laundering.

Waste oil delivered to unapproved premises, laundered and returned to original trader (waste oil does not remain the property of the original trader during this process)

As the premises is unapproved, the amounts must be entered to box 11 and duty must be accounted for by W50 payment. As the oil has left the scheme it cannot be returned to the trader under the tied oils scheme.

Waste oil is returned to stock at trader’s own premises (whether it has been laundered or not)

Amounts returned to stock are entered into box 5 and if it remains in stock should be counted and shown in box 13 as stock at the end of the accounting period. Otherwise it should be recorded on the HO34 accordingly.

Waste oil delivered to a duty suspended warehouse for use as furnace fuel

The initial amount of tied oil delivered to process is recorded in box 10. The waste oil is then returned back to stock and shown in box 5. When oil is delivered to a warehouse it must be accounted for in box 7 delivered to approved person. Warehouse to account for release of tied oil from scheme.

Waste oil destroyed at own premises

The amounts involved are recorded in box 15 (for audit purposes) and adequate records of destruction must be kept. If any useful heat is gained during destruction, amounts must be shown in box 11 and duty accounted for on W50 form.

Waste oil destroyed at contractor’s premises, where a certificate of destruction is supplied

The amounts involved are recorded in box 15 (for audit purposes). However, if the contractor gains any useful heat during destruction, amounts must be entered in box 11 and duty accounted for on form W50.

Waste oil destroyed at contractor’s premises, where no certificate of destruction is available

It is considered that the amounts involved have been diverted to an ineligible use and therefore duty must be accounted for on W50 form. The quantity concerned must be recorded in box 11 and a balancing figure entered in box 5, thus making boxes 6 and 14 equal.