Plastic Packaging Tax UK - in force from 1 April 2022

Maria McConnell | 22 March 2022


Plastic Packaging Tax UK - in force from 1 April 2022

Plastic packaging tax, or PPT, the UK Government’s newest ‘eco tax’, comes into force on 1 April 2022 meaning businesses that will be affected need to register now to avoid getting caught out.  The tax has been introduced to restrict the use of single use plastics and encourage a long-term shift towards the use of recycled plastics in UK manufactured goods and packaged goods imported to the UK. 

Plastic Packaging tax guidance

The tax will apply to plastic packaging where the plastic used in its manufacture is less than 30% recycled.  All plastic packaging will be assumed to be subject to the new tax from 1 April, unless it can be demonstrated that it meets the 30% recycled requirement to be exempt, so businesses will need to maintain suitable records to ensure that they can evidence the recycled content of all plastics used or purchased from this date onwards.

The tax is calculated on weight (tonnage) over a 12-month retrospective period, or a forward looking 30 day period, meaning any business that manufactures or imports 10 tonnes or more of plastic packaging from 1 April onwards will be required to pay £200 per metric tonne where the recycled content is less than 30%, even if only one tonne out of ten contains less than the required recycled content.  The 12-month ‘look back’ test only applies to plastic packaging products that were produced or imported after 1 April 2022 – items manufactured or imported prior to this date are not included in the turnover calculation.

How do I register for plastic packaging tax?

Affected businesses, which will include importers of packaging which already contains goods, such as soft drinks etc. will need to register to pay the tax.  A full list of packaging materials that are affected by PPT can be found here. From 1 April, every organisation that manufactures or imports PPT products will have to start keeping detailed records to identify these goods, with records being required  to be retained for a minimum of 6 years. 

When registering for PPT organisations must supply HMRC with an estimate of the tonnage of finished plastic packaging components they expect to produce or import over the following 12 months.  Returns will be due on a calendar quarterly basis and must be submitted and paid within 30 days of the period end.  The PPT returns will be accessed as an additional service line via gov.uk.

HMRC guidance on plastic packaging tax exemptions

HMRC have confirmed that there will be some categories of plastic packaging that will remain exempt from PPT, other than that which meets the 30% recycled content.  These include packaging used for licensed human medicines, plastics set aside permanently for non-packing use and exported items.

Businesses which manufacture or import exempt packaging may still have to register for PPT even where there is no tax due.  There will also be the opportunity to claim PPT credits where plastic packaging subject to PPT is later exported, either by your business or someone else.

If you are concerned that your business might be affected by this new tax and would like to learn more, please get in touch with our indirect tax specialists who will be happy to assist.

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