HMRC has issued a revised Notice 554 (August 2014) which gives information and guidance on procedures to be followed for the charging and collection of excise duty on fuel used in private pleasure craft and for private pleasure-flying
The notice has been amended to ensure that the UK definition of ‘private pleasure’ is in line with EU case rulings.
The UK held derogations from the Energy Products Directive (EPD) (2003/96) which permitted the use of reduced and exempt rates of duty for fuel used in private pleasure craft and for fuel used in private pleasure-flying. These derogations expired on 31 December 2006. These changes were required in order to comply with European legislation.
From 1 September 2014 following two decisions of the Court of Justice of the European Union in the case C-79/10 Helmholtz GMBH and case C-250/10 (Haltergemeinschaft), the scope of the fuel duty exemption has been more narrowly defined.
Previously, the fuel used for corporate jets, helicopters and/or marine vessels to transport staff for their business activity has been treated as exempt. However, these two rulings make clear that this activity falls into private pleasure use when there is no consideration for the transportation services provided to staff.
The UK definition will now follow the rulings in these two cases, as the UK takes its definition of private pleasure from the Energy Products Directive. HMRC have amended Notice 554 to ensure that our definition is in line with this. See section 9 and 16.
This notice cancels and replaces the February 2013 version.