From 1 April 2022, all businesses that manufacture or import 10 tonnes or more of plastic packaging in a 12-month period, including plastic packaging already filled with goods, will need to register with HMRC and account for the tax.
If a business finds they need to register for PPT, they can do so on GOV.UK from 1 April 2022. Liable businesses need to register within 30 days of exceeding the 10-tonne threshold.
Once a business becomes liable for the tax, they will need to keep accounts and records to use as evidence for the claims they make about their plastic packaging. Businesses will have to submit a return to HMRC every quarter, covering an accounting period.
Businesses liable must submit a return and pay any tax due no later than the last working day of the month following the end of the quarterly accounting period.
Assessment
Judith Kelly, deputy director of HMRC’s environmental taxes policy team, said: “We have worked hard to help businesses prepare for the tax, along with the support of our joint HMRC/Industry working group. We’ve delivered numerous tailored events to a wide range of sectors and are enhancing our guidance in response to customer feedback.
“Businesses now need to assess whether the tax will apply to them, and if so, take steps to register for the tax from April 2022. They must collate the information they need to comply with requirements when the tax comes into force.”
Recommendations
HMRC has set out recommended steps that businesses need to take to prepare for the tax, such as checking existing records, making sure they can accurately verify the source and composition of the plastic packaging and considering if it is possible to switch to alternatives.
The looming tax has sparked a flurry of movement in the market as companies look to secure recycled plastic. A number of large waste companies have built plastic recycling plants too, as prices have increased massively in recent months.
The tax will apply to plastic packaging manufactured in or imported into the UK where the plastic used in its manufacture is less than 30% recycled. It will be set at £200 per metric tonne of plastic packaging.
If a business cannot provide evidence to confirm the recycled composition of plastic packaging, HMRC will assume that the plastic in question contains less than 30% recycled plastic and will be subject to the tax.
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