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Plastic Packaging Tax - have you got it covered?
13th May 2021
HMRC has issued new guidance on the proposed Plastic Packaging Tax that is in Finance Bill 2021 and is due to take effect next year.
A new Plastic Packaging Tax is included in Finance Bill 2021 to take effect from 1 April 2022.
The tax will have an impact on plastic packaging manufactured in, or imported into, the UK where the plastic used in its manufacture is less than 30% recycled. However, packaging should only contain recycled content where this is permitted under food safety regulations.
HMRC has issued guidance on getting ready for the tax for those who may be affected so that action can be taken well in advance of the measure coming into force.
The rate of tax will be £200 per metric tonne of plastic packaging and is designed to encourage greater use of recycled rather than new plastic within plastic packaging with the aim of waste away from landfill or incineration.
Businesses that manufacture or import 10 or more tonnes of plastic packaging over a 12-month period will have to register for the tax later in 2021, whether or not they have to pay any tax.
Even where a business manufactures or imports less than 10 tonnes of plastic packaging a year, they will still need to keep some records to show that they are below the tax threshold, and to check if they become liable in the future.
Where a business buys plastic packaging on which the tax should have already been paid, they may still need to check that this is being properly accounted for to avoid the possibility of being held liable for any unpaid tax.
HMRC's guidance contains information on the registration requirements and record keeping. And further guidance and secondary legislation are expected later in 2021 once Finance Bill 2021 receives Royal Assent.
HMRC's guidance: Get your business ready for the Plastic Packaging Tax
Plastic Packaging Tax Webinar
Check out our recent webinar on the new tax where we discuss with industry experts the upcoming proposed changes to understand some of the finer details.
Visit our Food & Drink Knowledge Hub for advice and information across the sector.
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