Plastic Packaging Tax – Are you Ready?

An image of of bundles of plastic bottles as an illustration to support with the PPT blog post

The Plastic Packaging Tax (PPT) is a new tax that was introduced in the United Kingdom in April 2022.

Who is liable for Plastic Packaging Tax?

The PPT will be levied on manufacturers and importers of plastic packaging, however it is important to note that the Plastic Packaging Tax will only apply to companies that produce or import more than 10 tonnes of plastic packaging per year. This means that smaller companies that produce or import less than 10 tonnes of plastic packaging per year will not be subject to the tax.

How much is Plastic Packaging Tax?

For those companies that exceed this threshold, the tax is levied at £200 per tonne on plastic packaging that does not contain at least 30% recycled plastic content.

The goal of the tax is to reduce the amount of single-use plastic packaging that is produced and used in the UK, and to encourage companies to use more sustainable packaging materials.

This means that companies that produce or import plastic packaging for use in the UK will be subject to the tax. This includes a wide range of businesses, from large multinational corporations to small local manufacturers.

The tax will also apply to packaging that is imported into the UK from outside the EU.

What deadlines are associated with PPT?

The deadlines for compliance with the PPT are set to be phased in over time. From April 2022, companies will be required to register with HM Revenue & Customs (HMRC) in order to pay the tax.

From April 2023, companies will be required to submit their first PPT return to HMRC. The returns will be due on a quarterly basis.

How do companies comply with the new PPT Legislation?

In order to comply with the PPT, companies will need to take a number of steps:

  • Firstly, they will need to register with HMRC and obtain a tax registration number.
  • They will also need to keep records of the plastic packaging that they produce or import, including information on the recycled content of the packaging.
  • Companies will also need to calculate the amount of PPT that they owe, and pay it to HMRC on a quarterly basis.

One way for companies to comply with the PPT is by increasing the amount of recycled content in their plastic packaging. This can be done by sourcing recycled plastic to use in the production of new packaging, or by recycling more of the plastic packaging that they produce. Another option is to switch to using alternative packaging materials, such as paper or bioplastics, which are not subject to the tax.

Why has this PPT been introduced?

It’s important to note that the Plastic Packaging Tax is not a standalone measure, it’s part of the UK government’s plan to reduce the environmental impact of plastic packaging and to encourage companies to use more sustainable packaging materials. The government’s goal is to reduce the amount of single-use plastic packaging that is produced and used in the UK and to increase the recycling of plastic packaging. The Plastic Packaging Tax aims to play a key role in achieving these objectives by providing a financial incentive for companies to reduce their use of plastic packaging that does not contain recycled content.

What is plastic packaging tax?

So, in conclusion, the Plastic Packaging Tax is a new tax that was introduced in the United Kingdom in April 2023. The tax will apply to plastic packaging that does not contain at least 30% recycled plastic content. The goal of the tax is to reduce the amount of single-use plastic packaging that is produced and used in the UK, and to encourage companies to use more sustainable packaging materials. Companies can comply with the tax by increasing the amount of recycled content in their plastic packaging, switching to alternative packaging materials or adopting recycling program.

If you think you are affected by this relatively new legislation, please feel free to contact the IN Accountancy Team, who will be happy to help.

For further detailed Plastic Packaging Tax guidance from HMRC and to check if you need to register your company for PPT, please see the links below:

https://www.gov.uk/guidance/check-if-you-need-to-register-for-plastic-packaging-tax

https://www.gov.uk/guidance/completing-your-plastic-packaging-tax-return

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