Plastic Packaging Tax rate to increase from 1 April 2024
Posted on: February 12th 2024 · read
From 1 April 2024, the rate of Plastic Packaging Tax (“PPT”) will increase from £210.82 per tonne to £217.85 per tonne. PPT is payable by businesses which within a 12 month rolling period manufacture or import 10 tonnes or more of plastic packaging into the UK, which is less than 30% recycled.
PPT was introduced on 1 April 2022 to encourage businesses to replace virgin plastic in its packaging with recycled content. Businesses which meet the threshold to register for PPT must pay tax and report the amount of plastic packaging manufactured or imported into the UK to HMRC. The PPT rate per tonne started on 1 April 2022 as £200 and has steadily increased each year.
How does this affect you?
- If your business manufactures or imports 10 tonnes or more of plastic packaging into the UK (within a 12-month rolling period), you are required to register and account for PPT.
- Importantly, PPT does not only apply to UK businesses. If you are an overseas company importing 10 tonnes or more of plastic packaging into the UK, you will need to register for and declare PPT.
- Your PPT payments will likely increase from April 2024 because of the tax rate increasing. You should take the increase into consideration when you are pricing your goods and whether to pass the PPT cost onto your customers.
How can we help?
Our PPT specialists are experienced in advising on a wide range of issues including:
HMRC expect both UK and overseas businesses to be aware of their obligations to register for PPT and to complete their registration at the correct time. Our team can confirm your requirements to register and complete the application on your behalf.
If your business or one within your supply chain either avoids, evades, or does not comply with PPT requirements, you could be joint and severally liable for any unpaid PPT including interest and penalties. Our team are experienced in completing supply chain due diligence exercises, which lessen the risk of being liable to PPT payments. Equally, if a supplier is charging your business PPT, we can complete a review and determine if you have been charged PPT correctly. Should your supplier have charged you PPT incorrectly, we can assist in the recovery of tax from your supplier.
Once registered for PPT, you are required to collate information providing details of the plastic packaging used in your trade and submit quarterly returns to HMRC. We can review the information you have available to confirm if your business meets the record-keeping requirements. Additionally, we can review your PPT return calculations, to ensure that tax has been calculated correctly and determine if there is any opportunity for exemption or deferral of the tax.
The products you manufacture or import may be exempt from PPT, but you may still be required to register for PPT. Our specialists can confirm the treatment of the products you manufacture or import, and your obligations to register.
If you would like to discuss the changes to Plastic Packaging Tax and how they could impact your business, please contact a member of our Indirect Tax team using our online enquiry form and we will be in touch shortly.