This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Hydrocarbon Oils Strategy


The following technical terms and abbreviations are used in this guidance.

A, B, C, D, E, F, G, H, I, K, L, M, O, P, R, S, T, U, V


Abbreviation Meaning


AA Automobile Association
AAD Administrative Accompanying Document (now known as eAD)
Approved distributor A person who has been individually authorised and approved for the purpose of supplying tied oil, in the course of trade, for eligible use. This will include anyone who stores oil in duty suspended installations and delivers it as tied oil.
Approved user A person who has been individually authorised and approved for the purpose of putting tied oil to eligible use.

Top of page


Biofuel Bio diesel, bio blend or bio ethanol. Can be used in place of some mineral oils including heavy or light oil.
BT Ops Based in Glasgow, they are taking over most of the fuel duty admin from MORC in 2018, including RDCO, tied oils, biofuels, gas, and HO10 returns, and processing of claims.

Top of page


CEMA Customs and Excise Management Act 1979.
Category ‘E’ oils Oils in this category are unsuitable for use as road fuels. This may change in the future due to the advances in technology and the ability to use these as road fuels.
Civil Penalties The Finance Act 1994 removed from excise criminal law a number of ‘offences’ which we had previously been able to prosecute through the courts. In their place the Finance Act 1994 provided for a series of Civil Penalties that may be imposed when these breaches or failures occur, without reference to the courts. (See Public Notice 209).
Class approval scheme Traders who deal in tied oils only in containers of less than 210 litres can operate under the Class Approval Scheme.
Controlled Oils Controlled oils are those oils subject to a rebated rate of duty under sections 11 and 13 of HODA, namely:
  • marked rebated gas oil ( red diesel) including ultra low sulphur gas oil
  • marked rebated kerosene
  • aviation turbine fuel (AVTUR). 

Top of page


DERV Fuel for Diesel Engine Road Vehicles. It is a heavy oil (diesel) which is charged at the full road fuel duty rate.
DTR Departmental Trader Register
DVLA Driver and Vehicle Licensing Agency, in Swansea.
Designated Marker A chemical added to oil to indicate Excise Duty at a rebated rate has been paid, and consequently that the oil is not to be used as fuel for road vehicles. It is usually used with a dye so that rebated oil can easily be identified. The current gas oil dye is a red colour.
Duty of Care (RDCO) RDCOs have a duty of care when selling or delivering controlled oil and they must take all reasonable precautions and exercise reasonable care to ensure that they only make supplies of rebated oils to customers who have a legitimate use for this.

Top of page


EX601 A document used to notify an assessment or civil penalty relating to excise goods
EXIT465B A form used to record and to report details of a visit to an Excise or International Trade trader.
(There is a specific ‘Oils Strategy’ 465B )    
  Eligible use Use of oil other than as: fuel for any engine, motor or other machinery (including extender or additive to motor fuel); or heating fuel.
  Excepted Vehicle Those vehicles specifically excluded from the legal definition of ‘road vehicle’ which may be use rebated heavy oil as road fuel.
See Public Notice 75    
  Excise Duty The United Kingdom (UK) Revenue Duty charged on both UK produced and imported Energy Products. It is charged at a specific rate on the quantity and description of products delivered to home use.
  Euro-marker A statutory marker added to rebated fuels throughout Europe. Gives fuel, for example, kerosene, a pale yellow colour.

Top of page


FA (94) Finance Act (1994)

Top of page


Gas Oil Heavy oil, of which not more than 50% by volume distils at a temperature not exceeding 240ºC and of which more than 50% by volume distils at a temperature not exceeding 340 ºC.

Top of page


HODA Hydrocarbon Oils Duties Act 1979.
HOMR Hydrocarbon Oil (Marking) Regulations 2002.
HOR Hydrocarbon Oil Regulations 1973.
H&S Health and Safety
HGV Heavy Goods Vehicle
Heavy Oil Oils such as AVTUR, DERV, fuel oil, gas oil, kerosene. By definition any oil which does not meet the criteria for classification as a light oil. The criteria are based on boiling point, and the temperature at which vapours are given off during distillation.

Top of page


Ineligible use Use of oil as: fuel for any engine, motor or other machinery (including extender or additive to motor fuel); or heating fuel.
Inland Detection Part of Fraud Investigation Service (FIS).
IDCC Inland Detection Controls Centre (in Paisley).

Top of page


Kerosene A heavy oil of which more than 50% by volume distils at a temperature not exceeding 240ºC. Commonly known as burning oil or paraffin, kerosene carries a nil rate of duty (fully rebated) when used as a heating fuel.
Not to be used as road fuel, or as fuel for any engine.  

Top of page


LGC Laboratory of the Government Chemist.
Light Oil Mineral (Hydrocarbon) oil (a) of which not less than 90% by volume distils at a temperature not exceeding 210ºC; or (b) which gives off an inflammable vapour of less than 23ºC when tested in the manner prescribed by the Acts relating to petroleum.

Top of page


MPG Miles Per Gallon
MORC The Mineral Oil Reliefs Centre (MORC) at Newcastle advised on all relief schemes and other fuel duty admin, until mid to late 2018..
MOT Ministry of Transport - Test Certificate
Marked Kerosene MKO a heavy oil which carries a NIL rate of duty (fully rebated) when used as a heating fuel.

Rebated kerosene has ‘yellow’ colour as a result of the addition of the euromarker.

Not to be used as road fuel, or as a fuel for any kind of engine.    
  Marked Gas Oil MGO - a heavy oil which carries a lower (rebated) rate of Excise Duty. Commonly known as ‘Red’ or ‘Red Diesel’ (because of the red dye).

Not to be used as a road fuel, but can be used in certain excepted vehicles and stationary engines.

It may also be used as a fuel to propel inland pleasure craft provided the duty is paid.    
  Marked Oil Oil containing markers prescribed by the Hydrocarbon Oil (Marking) Regulations 2002.
  Marking The addition of chemical markers and dyes to oil to differentiate between product for road use and product for other purposes. Marked oil is delivered at a rebated rate and should not be used in road vehicles.

Top of page


OSMI Oils Strategy Management Information. Management Information used to supplement Ops data and to monitor the progress of the Oils Fraud Strategy.

Top of page


PACE Police and Criminal Evidence Act 1984
PPE Personal Protective Equipment
PPOB Principal Place of Business

Top of page


RIS Risk & Intelligence Service (part of Enforcement & Compliance)
Rebate The difference between the full rate of Excise Duty and the reduced rate allowed on certain types of oil when put to specified uses.
It is illegal to use rebated fuels as fuel in road vehicles.    
  Rebated Heavy Oils Usually gas oil or kerosene which are heavy oils that carry a lower rate of duty, (rebated), than that for fully duty-paid fuel.
There are restrictions to the uses that rebated heavy oils can be put.    
  Rebated oil Oil on which a rebate of duty has been allowed.
  Registered Dealer in Controlled Oils (RDCO) An RDCO is a trader who has been approved to sell or deal in controlled oils.
  Registered Remote Marking Premises Duty paid terminals that have been registered and approved to mark oils.
  Repayment User A person who has been individually authorised and approved for the purpose of reclaiming excise duty on duty paid oil put to eligible use.
  Revenue Trader A person carrying on a trade or business subject to any of the revenue trade provisions of the Customs and Excise Acts, including importing, exporting, producing, handling, processing, packaging, transporting or dealing with goods chargeable with Excise Duty. (CEMA s1)
  Road fuels These oils include: Diesel, Petrol and Unleaded Petrol.
  Road Fuel Testing Unit (RFTU) FIS Road Fuel Testing Units are mobile units responsible for testing the fuel in road vehicles, retail and bunkering sites in order to detect misuse.
  Road Vehicle Any vehicle constructed or adapted for use on roads, but does not include any vehicle which is an ‘excepted’ vehicle.
  RIS Part of Enforcement & Compliance. Teams prepare visits, analysing for risk, looking at customer history, and assisting the Oils Strategy in a coordinated, risk-based approach to intervention.

Top of page


SFD Sulphur Free Diesel - Gas Oil with a sulphur content of less than 0.001 per cent by weight, or NIL.
SI Part of FIS - Specialist Investigations. Includes Inland Detection work, as opposed to the work of the UKBA (UK Border Agency). Includes the RFTU.

Top of page


Tachographs Provide a record of journeys made by HGVs and have reliable mileage information.
Tied Oil Hydrocarbon (Mineral) oils which are: any light oils; or heavy oils that fall into the excise definition of gas oil, fuel oil or kerosene, which are delivered conditionally relieved of excise duty in order to be put to an eligible use.

Top of page


ULSD Ultra Low Sulphur Diesel - a more environmentally-friendly replacement for DERV with a much lower sulphur content.
This has been replaced by SFD for all road and off-road use.  
( Tied oil ) For the purposes of relief given under the Tied Oils scheme, ‘Use’ must involve a process that, if it does not actually consume the oil to the extent that there is little or nothing left, demonstrably affects the performance of the resultant product and/or contributes to its suitability for eligible use.

Top of page


VAT Value Added Tax
VAT457 A form used as a receipt for documents or other records obtained from, or uplifted from a trader.
VISION VAT information System Inter-Office Network
Vehicle Licence The vehicle excise licence often known as the ‘tax disk’ or ‘road fund licence’ issued under the Vehicle Excise and Registration Act 1994 by the DVLA or its agents.