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HMRC internal manual

Oils Technical Manual

HM Revenue & Customs
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Appendices: Glossary

Term Definition
Abel-Pensky Method A method, using specific apparatus, of determining flashpoint.
Additive Any substance added in small proportions to mineral oil to improve or modify its quality or characteristics as a fuel or lubricant.
Anti-knock preparations Compounds used as additives to motor spirit to improve the ignition quality of the fuel by delaying premature ignition.
Approved mixing Mixing of oil in accordance with permission under the Hydrocarbon Oil (Mixing of Oils) Regulations 1985.
Assurance staff Assure the collection and protection of the revenue and facilitate trader compliance.
Asphalt A solid hydrocarbon found dissolved in natural mineral oil
Audit Specialists This was created as the Audit Service in 2004 to undertake specific audit work at businesses that have been identified in business’s Risk Assessment (e.g. LB Core System). Audit Specialists are either part of LB’s urban centres, or part of LC’s SEAT teams (Systems Evasion & Audit Teams)
Authorised Person A person authorised by the Commissioners.
Batch A separate quantity of oil (or other substance) moved at one time or processed at one time. It contrasts with quantities move continuously or continuous processing.
Biodiesel A diesel quality liquid fuel derived from biomass or waste cooking oils, the ester content of which is not less than 96.5% by weight and the sulphur content of which does not exceed 0.005% by weight or is nil.
Bitumen Extremely heavy semi-solid product of oil refining used for road preparations.
Black oil A description of the heavier, less pure oils such as fuel oil and crude.
Blending Mixing of various components in the preparation of a product of specified properties.
Border Force Formerly the UK Border Agency. Part of the Home Office.
Bulk litres The volume of oil at ambient temperature.
Bund An area containing a tank or group of tanks surrounded by a wall or earthwork high enough to contain any tank leaks, bursts or ‘boil-overs’.
Bunkers Any product supplied to fuel a ship’s engines or equipment. The ‘bunkers’ are the place where fuel is stored on the ship.
Burning oil Alternative name for kerosene.
Butane Normally a gas but can easily be liquefied (see LPG). Component of gasoline.
C88 A Single Administrative Document (SAD) used to make Import/Export Entry of goods for Customs Purposes, or to accompany third country goods which have transited via another member state duty-suspended.
C&E930A Excise Duty on Gas for use as a Road Fuel.
Calibration Table A table showing the volume of oil in a storage tank at various levels (see Tank strapping).
Cetane number A means of expressing the energy value of a diesel fuel.
CITEX Customs, International Trade & Excise
Common storage Duty paid and duty unpaid stocks of oil which are held in common storage: oils of different tax status but the same description mixed together in the same tank.
Coumarin Statutory marker added to kerosene. (1.2 benzopyrone).
Criminal Investigation Investigates, prosecutes and dismantles organised and large scale oil frauds such as laundering or mixing plants.
CRM Customer Relationship Manager. Works in LB, with Tax Specialists and Trade Sector Advisers, Main HMRC contact for a large trader. Plans work to be carried out, and works with Audit Specialists and cross-tax teams.
Crude oil The basic raw material that undergoes the refining process.
Cycle The sequence in which oils of different types are shipped by pipeline.
Dark Oil A Heavy oil which is darker than ASTM colour 3.0 in the Table of Glass Colour Standards. For field test purposes oil that is darker than a used copper coin. (Not for use as a motor or road fuel - as it is too dark to be able to identify the presence of any fiscal dyes).
Deferment Trader A trader who is approved to defer the payment of excise duty,
Duty deferment guarantee Allows an oil company to defer any excise duty liable on product removed from bond during an accounting period, until the last business day of the following month.
Density The mass of solid or liquid (determined by weighing under controlled conditions) which is contained in one unit of volume of the solid or liquid at a specified temperature.
Dip The depth of liquid in a bulk tank measured using a dip tape or dipstick.
Diesel See DERV.
Distillate See Middle Distillate
Distillation (Refining) Distillation involves heating the oil up, and because different components can be boiled off at different temperatures, each can be drawn off separately and used to make different types of oil.
Distillation columns This is where the actual transformation of the crude oil takes place.
Downstream The refining and marketing sectors of oil companies’ activities.
Drawback Repayment of the duty paid on product exported, warehoused for export or shipped as stores on aircraft or ship.
Dutiable use Dutiable use of oil delivered for home use includes as fuel for any engine, motor or machinery, or as heating fuel.
Duty See Mineral oil duty.
Duty point The point at which oil becomes legally liable to excise duty ( e.g. when products are loaded to leave the refinery)
Duty Suspended Premises A warehouse, where oils are stored without payment of duty before delivery to home use. These are normally attached to the producer’s premises, or are Import warehouses.
Duty Suspension The process that allows oils to be stored without paying Excise Duty, until the oils are delivered to home use.
Duty-paid terminal An oils terminal where all the oils in storage have borne excise duty.
Egress The point at which oil is delivered out of a pipeline.
Electrical oils Oil used as a coolant or insulating fluid in electrical machinery.
EMCS Excise Movement & Control System, introduced in 2010 along the the Excise Goods (Holding, Movement & Duty Point Regulations, replacing AADs with eADs, introducing ARC numbers for each movement, replacing REDS with Registered Consignees, with the same rules for all duty-suspended EU movements of excise goods.
Energy Institute Formerly the Institute of Petroleum, a society that keeps under review the techniques and equipment used for measurement, safety, engineering, etc, in the oil industry.
Enforcement & Compliance (E&C) Includes Counter-Avoidance, Criminal Investigation, Debt Management & Banking, Local Compliance, Risk & Intelligence Service, Specialist Investigations.
EPSS Excise Payment Security System - guarantee waiver for compliant SMEs to enable easier financing of revenue trader activity.
Euro-marker A statutory marker added to rebated fuels throughout Europe. Gives fuel a pale yellow colour. Countries may add their own markers and dyes in addition to Euro-marker - the UK does. N-ethyl-N{2-(1-isobutoxyethoxy) ethyl}-4-(phenylazo) aniline.
Ex rack Product collected directly from a refinery or major storage terminal
Excepted vehicles Vehicles as defined under Schedule 1 of the Hydrocarbon Oil Duties Act 1979 as amended, which may use rebated heavy oil. More information is available in Public Notice 75 ‘Fuel for Road Vehicles’.
Excise Duty The United Kingdom revenue duty chargeable on both imported and home produced motor and heating fuels. It is charged at a specific rate on the quantity and description of oil delivered to home use.
Excise Duty point The time when the requirement to pay any duty with which the goods become chargeable. It is charged at a specific rate on the quantity and description of oil delivered to home use.
Excise Goods Goods that are liable to Excise duty.
Excise Warehouse A place of security approved by the Commissioners under the Customs and Excise Management Act 1979, Section 92.
Extra Statutory Concession (ESC) A concession that is not legislated for but simply set out in an ESC. Remaining ESCs can be found in Notice 48.
EU The European Union. The member states currently are:

Croatia ,Cyprus
Czech Republic
United Kingdom
  | | Feedstock | Material to be processed in a refinery. | | Flash point | The lowest temperature at which oil ignites momentarily in air, under specified conditions. | | Floating Roof Tank | A tank in which the roof floats on the product to prevent the build up of vapour. Usually found in motor spirit tanks. You should never go on top of a floating roof tank, even when it is at rest. | | Fractional Distillation | The separation of crude oil into its constituents or ‘fractions’. Separation is determined by the different boiling points of the constituents. This is the basic process that occurs at a refinery. | | Fuel oil | Heavy oil which contains in solution an amount of asphaltenes and has a closed flashpoint not exceeding 150ºC. Used for fuelling large steam turbines, e.g. in power stations or marine engines. | | Fuel substitute | Any liquid which is not mineral oil but is intended to take the place of a mineral oil. Fuel substitutes are liable to excise duty at the same rate as the product they are substituting for. (N.B. This principle also applies to those Biofuels used as a Fuel substitute, other than Biodiesel or Bioethanol which attract a reduced rate of duty) | | Gantry | A static platform that gives personnel access to top-loading road and rail tankers. | | Gas condensate | A Light oil that is a naturally occurring by-product of gas production. | | 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 340ºC. | | Gasoline | See Motor spirit. | | Hard asphalt | A form of asphalt which is insoluble in petroleum. | | Heavy oil | Oil other than light oil, for example, jet fuel, diesel and fuel oil. | | High flash | Oil where the flash point is more than (>) 32ºC | | HM2 | Duty return for Registered Consignees. | | HM4 | Form for the importation of duty paid goods by Temporary Registered Consignees. For duty-suspended imports, they use a TRC2 form. | | HO 9 | A form used for rebate claims when duty paid gas oil, kerosene and possible ultra low sulphur diesel (ULSD) has taken place at a remote marking premises (RMP). | | HO10 | A warrant for Hydrocarbon Oils for Home use Duty Deferment Account. | | HO 11 | Pre-repayment credibility query form. | | HO 65 | Form used to claim for netting rebate. | | HO930 | A return for Excise Duty on Fuel Substitutes. | | Home use | Product delivered to the UK home market with all duties accounted for is referred to as ‘delivered to’ home use. | | Hydrocarbon | Chemical descriptor of any molecule containing only carbon and hydrocarbon atoms. Crude oil typically contains more than 97% hydrocarbons. | | Indirect Tax Directorate | Includes various policy teams. | | Inland Detection (ID) | Part of Specialist Investigations (SI). An inland version of Border Force. | | Inflammable vapour | Fumes or atmospheres which can catch fire. | | Ingress | The point at which oil enters a pipeline. | | Interface | The point at which two parcels of oil meet and merge in a pipeline. | | 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. Not to be used as road fuel. | | Large Business | LB is responsible for coordinating the duty payments and systems in place of the largest traders, working with colleagues in other areas e.g. VAT, Trade Sector Advisers and Audit Specialists. | | Laundering (illegal) | Process used to remove the statutory markers from rebated Gas oil (MGO) or from rebated Kerosene (MKO). | | Law Enforcement (LE) Policy | LE Policy is responsible for the creation, implementation and monitoring of the Oils Strategy. | | Light oil | Oil of which not less than 90% by volume distils at a temperature not exceeding 210ºC or which gives off an inflammable vapour at a temperature of less than 23ºC when tested in the manner prescribed by the Acts relating to petroleum. | | Linearity | The situation in which actual measurements when set against the true values in a graph produce an acceptably straight line. In relation to meter accuracy the term is applied to the range of rates of flow over which the accuracy as a percentage of the true value is within acceptable limits, i.e. the graph of percentage accuracy against true value is an acceptably straight horizontal line. | | Local Compliance | Have responsibility for small and medium enterprises (SME). Includes CITEX. | | Low flash | Oil where the flash point is less than or equal to (≤) 32ºC. | | Lube cube | See IBC. | | Lube oil | Heavy oil used for lubrication of moving parts. Not liable to excise duty. NB The specification of some lube oils can be very close to Gas oil, so there is the possibility of mis-description of gas oil to avoid a liability to excise duty. | | Marked oils | Those oils that have been marked to claim a rebate of Excise Duty. The oils affected are Gas Oil, and Kerosene. These oils are also known as controlled oils. | | 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. | | Marking Waiver | Approval to receive rebated oils ‘unmarked’ may be granted for technical or health and safety reasons; e.g. AVTUR is a high performance kerosene supplied for use in Aviation Turbine engines, under such a waiver. | | Medium oil | Oils which for customs duty purposes lie between spirits and heavy oil. It includes lighter oil within the excise definition of heavy oil but is not an excise category of oil. | | Metering | A means of recording the volume of product supplied. Metering is generally used for deliveries into road and rail tankers | | Meter creep | Small quantities recorded on a meter totaliser but not delivered. Usually the result of an accumulation of fractions of a litre that cause a meter to click over one digit between deliveries. | | Meter proving | The process of determining a meter’s accuracy by comparison with another measuring device whose accuracy is traceable to a national standard. | | Middle distillate | The products from the mid range of the fractionating column during distillation of crude oil. Gas oil and kerosene. | | Mineral oils | Mineral oil is the organic remains (compounds of hydrogen and carbon) of plant, marine and animal life, which existed between 400 million and 40 million years ago. Hydrocarbons that are liquid at 15ºC. The terms ‘hydrocarbon oils’ and ‘mineral oils’ mean the same thing. | | Mineral oil duty | Mineral oil duty is a UK Excise Duty which is payable on UK-produced and imported oils. | | Motor and Heating Fuels Warehouse | An excise warehouse where mineral oil may be received and stored and the payment of excise duty and VAT is suspended. | | Motor spirit | Oil used as a fuel for a petrol engine charged at the full rate of duty. | | Natural litres | See Bulk litres. | | Netting | A means by which traders approved for duty deferment may off set deliveries qualifying for duty free status against duty payments. | | Octane number | A measure of the anti-knock value (i.e. the ignition quality) of motor spirit. | | Officer/Officers | A person delegated the powers given or the responsibilities laid to the Commissioners of H.M. Revenue and Customs and empowered to act on their behalf whilst dealing with members of the trade or public. | | Oil products | Mineral (hydrocarbon) oil products produced by refineries from crude oil, shale, and other oil feedstocks. See HCOTEG12650 for a list of oils products | | Oil supply chain | The oil supply chain is the physical movement of oil from the manufacturer to the end user. | | Paraffin | See Kerosene. | | Parcel | An individual grade of oil delivered as part of a larger consignment. Several parcels will commonly make up a shipping or pipeline delivery. | | Petroleum | Motor spirit, petrol. | | Pipeline | The most common way to get crude oil produced by oil platforms and drilling rigs at sea to the refinery is by pipeline (although ships may also be used). Also cross country pipelines used commonly for moving large batches of fuels between refineries and oil terminals. | | Pipeline Adjustment Schedule | Gives details of the duty liability or credit generated by pipeline interfaces. | | Pots | Compartments within the body of a road tanker wagon (RTW) each of which can hold different products. | | Producer | A company engaged in the production of oil at approved premises. | | Propane | Normally a gas but can easily be liquefied. It is the principle gas used as road fuel (see LPG). | | Quinizarin | Statutory marker added to gas oil. 1,4-dihydroxyantheaquinone. | | Rebate | The difference between the full rate of 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 fuel | Fuel on which a rebate of duty has been allowed. | | Red diesel | See MGO. | | Refinery | Premises approved by the Commissioners for the treatment of oil. | | Remission | A decision not to collect any revenue owed. If revenue has already been paid, we will repay it. | | Refinery officers | Have a responsibility for approvals and issues at refinery sites. | | Remote Marking Premises | See RMP | | Retail | The oil industry term for sales of motor fuels (petrol and diesel) via filling stations. | | Removal schedules | Record deliveries or transactions that have revenue implications. | | Revenue trader | A person carrying on a trade or business subject to any of the revenue trade provisions of Customs & Excise Acts, including importing, exporting, producing, handling, processing, packaging, transporting or dealing in goods chargeable with excise duty. (See CEMA, Section 1). | | Risk managers | Have responsibility to assure the collection and protection of the revenue by identifying and prioritising assurance activity to the business’s areas that pose the greatest risk. | | SCADA systems | Supervisory, Control and Data Acquisition systems which monitor in ‘real time’, movements of oil and associated tankage, valves and pipeline conditions. | | Simplified Import VAT Accounting (SIVA) | A scheme to reduce the level of financial security required to guarantee the payment of Import VAT through the Duty Deferment System. | | Sulphur Free Diesel (SFD) | Gas oil with a sulphur content of less than 0.001 per cent by weight, or nil. All road users generally must use this grade. | | Sulphur Free Petrol (SFP) | Petrol that does not contain more than 10 p.p.m. of sulphur. All road users generally must use this grade. | | Solvent red | A red dye used to mark fuel, technically referred to as CI (colour index) Red 24 dye. | | Solvent yellow | A combined Yellow dye and fiscal marker used to mark fuel, also known as the Euro-marker or Solvent Yellow 124. | | Standard litres | Bulk litre volume converted to the volume that would occur if the temperature was 15ºC (standard litres are also known as litres@15ºC). The standard litre is the unit of quantity required for excise accounting purposes (see STA). | | Statutory Instruments | Statutory Instruments make the Regulations. They state how things will be done in terms of procedure and sometimes amend earlier Regulations. | | Tank Strapping | The means of calibrating a bulk storage tank by taking the dimensions at successive heights. These measurements are subsequently converted to volumes and reproduced in a tank calibration table. | | Tax Specialists | Tax Specialists work to CRMs and deal with the technical tax work at the businesses. | | Tax Warehouse | A warehouse where excise goods are produced, held, received or dispatched under duty suspension arrangements as required by EU Directive. | | Technical oils | Commercial indication that oil is specially produced other than as a fuel or lubricant. | | Terminal | A large storage depot usually owned by an oil company or independent storage company and supplied by pipeline, rail or sea. | | Tied Oil | Industrial oil permitted to be delivered duty free when to be put to an eligible use i.e. not used in an engine or for heating fuel, usually supplied fiscally unmarked. | | Tractor diesel | See Red diesel. | | Trade Sector Advisers (TSAs) | TSAs provide an in depth knowledge of a particular trade sector and types of businesses involved in the oils industry. | | Transformer oil | Oil used in electrical transformers as a coolant and as an insulator. See also electrical oils. | | Transport Taxes Team | Part of Indirect Tax Directorate. Responsible for developing the structure and scope of the tax, implementing, monitoring and maintaining Oils Policy, on tax liability and procedural issues - interpretation of law and introduction of legal change. Produce guidance, public notices and training materials on Mineral Oils, Biofuels and Fuel substitutes. | | Ullage | The measurement in a bulk tank of the distance between the liquid surface and an upper reference point i.e. the gap above the product. Alternative method of gauging a tank’s volume to dipping. | | Un-rebated oil | Un-dyed and unmarked oil that has borne duty at the full rate. | | Upstream | The exploration and extraction activity of an oil company prior to refining. | | Value Added Tax (VAT) | VAT is chargeable on imported oil, whether or not any duty is chargeable or relieved. | | VATA 94 | VAT Act 1994. | | VAT 908 | Hydrocarbon Oils: Deferment Advice for VAT due on removal from Warehouse. | | Vapour Recovery | The process of recovering the hydrocarbon vapour produced during delivery from the Gantry into a Road Tank Wagon (RTW) or on subsequent delivery from the RTW. Duty can be reclaimed on recovered vapour. Currently under review by Indirect Tax Directorate. | | Vapour recovery units | Used at delivery points to collect mineral oil vapour for recovery in liquid form. Mandatory following an EU anti-emissions Directive. | | Viscosity | The resistance of a liquid to flow. | | W50 | Remittance/Deferment Advice for Additional Payments of Duty and/or VAT | | Warehouse officers | Have a responsibility for approvals and issues at excise warehouses. | | Weighbridge | A means of measuring oil quantities. Weighbridges must be approved by the National Weights and Measures Laboratory of DTI and must be tested and stamped by the local Trading Standards Department before using them to raise a revenue account. | | White diesel | Another name for unmarked, un-rebated Diesel or Gas Oil. A 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 340ºC | | White oil | White Oils are liquid mineral oils other than fuel oils and heavier residues | | White spirit | A specialised light oil normally used as a solvent |