84 Understanding the new Plastic Packaging Tax From 1st April, 2022, the new Plastic Packaging Tax (PPT) came into force. 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 PPT. The tax will be charged at £200 per tonne on plastic packaging that contains less than 30 per cent recycled plastic. Manufacturers and importers whose plastic packaging contains 30 per cent or more recycled plastic still need to register but will not have to pay the tax. PPT aims to incentivise the use of recycled plastic in plastic packaging, to help tackle the critical issue of plastic pollution and reduce the amount of plastic that is incinerated or goes to landfill. Detailed guidance is available on www.gov.uk to help businesses work out whether the tax will apply to them and how to register. If a business finds they need to register for PPT, they can do so on the website. Liable businesses need to register within 30 days of exceeding the 10-tonne threshold. There are two threshold tests for businesses to consider when checking if they exceed the threshold. There are worked examples on online of how the threshold tests apply in practice. When registering for PPT, businesses may be asked some additional security questions about their tax records to ensure they are verified with HMRC, such as details about their Corporation Tax or Pay As You Earn (PAYE) for their employees. Once a business becomes liable for PPT, they’ll 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. The accounting periods are: • 1 April to 30 June • 1 July to 30 September • 1 October to 31 December • 1 January to 31 March. Businesses liable for PPT 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. For example, if a business became liable to register before 1st July, 2022, the first return will be due 29th July, 2022. Judith Kelly, Deputy Director of HMRC’s Environmental Taxes Policy Team, explains: “PPT is part of a comprehensive package of measures set out in the Government’s Resources and Waste Strategy, which aims to minimise waste, promote resource efficiency and move towards a circular economy. As a result of the tax, it’s great to see that many businesses have already started to increase the amount of recycled plastic in their packaging before the tax goes live. “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.” HMRC has set out recommended steps that businesses need to take to prepare Now PPT is fully in place here’s some guidance from HMRC to ensure your business is ticking the right boxes
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