Having worked for a fuel oil company for years I can tell you that the difference between DERV (road fuel) and Red Diesel is that RD has dye in it but also has less lubricants, and no additives or other detergents added. The reason being cost. Oil companies don't waste their additive packages on fuel which is in the main going to be burned in industrial heating systems, and a small percent used in agriculture.
And being caught with it (or traces of it) in your tank will mean HMRC will take your arse out with the unpaid duty on the fuel
they believe you've used, and the cost of the car isn't really
relevant, nor is the fact that you don't get it back. Your vehicle is
siezed and forfeited, but you can apply through the Courts to
have it returned if you choose. If you get caught with red diesel in
your tank, you've committed a criminal offence (tax evasion) and will
be prosecuted if the need arises. They can claim duty on fuel for up to
7 years previous and the onus is on you to prove otherwise. Bear this
in mind aswell..."If your conduct involves dishonesty, a penalty of up
to 100% of the duty evaded may be imposed."
So, you risk losing
your vehicle (as in not getting it back), a penalty of £250 for each
offence (so that would be each time you drove the vehicle will red
diesel in it), repayment of the unpaid duty, a fine equal to the unpaid
duty, an unlimited fine and a stay in jail for up to 2 years if you
decide to obstruct the officer inspecting your fuel, and finally "In
the more serious cases involving dishonesty criminal action may be
taken, and you can be fined an unlimited amount or you may be
imprisoned for up to seven years, or both."
Worth noting
aswell that all (agricultural vehicles aside) DVLA-licensed vehicles
must always use fully duty paid fuel, both on and off public roads. So
if it has a tax disk on it and has red diesel in it, you're committing
an offence, regardless of what you're doing with the vehicle.
As an example.... they take a reasonable guess as to how much diesel you've not paid
duty on. Reasonable to them, mind. Might have no bearing on how much
you've actually used. If your 3 year old vehicle has 100k miles on it,
and you've had it from new, then they could reasonably argue that you
owed duty on all the fuel you used in those 3 years to cover 100k
miles.
That works out at eg.: 40mpg = 2500 gallons = 11350ltrs @ ~65p duty per ltr. Which works out at £7377.50
Of course, you'd have to prove otherwise if you could.