The Plastic Packaging Tax came into effect in April this year, and if your business deals with any kind of plastic packaging in relation to your products, then listen up to the below.
The Plastic Packaging Tax has been in effect since April this year. If you’re working with any kind of plastic packaging related to your products, then it’s important to be aware and potentially be registered for this tax! If your importing or manufacturing more than 10 tonne then there are certain things you need to know. On a positive note: if at least 30% of the plastic is recycled by weight, that could help reduce or even avoid taxes entirely – so think green when creating your next product line-up!
Why is this being introduced? Well the tax has been intrdouced to encourage manufacturers both here and abroad to use more recycled plastic in their processes which is great for the environment and your green credentials.
Plastic Packaging Tax, when to notify HMRC?
You need to make sure that your register your business for the plastic packaging tax with HMRC if your business has imported or produced more than 10 tonnes of plastic since April 1 this year. It’s important that you do this within 30 days of breaching the limit to ensure you don’t get any penalties.
Missed the plastic packaging tax submission time? Then you need to ensure you get in touch with either your accountant or HMRC directly and inform them as quickly as you can.
How many businesses are affected by the plastic packaging tax?
According to government sources approx 20,000 business are effected by this new tax, many of whom may not be aware of it, so it’s vital if you’re a business who think they may be to get in touch with your accountant if they haven’t brought this up with you already.
How much is the plastic packaging fee per tonne?
If you’re wondering how much the plastic packaging tax fee per tonne is that you use or manufacture then the answer is £200 per metric tonne used or manufactured. The key question you may be asking though is what exactly is considered to be ‘Plastic’ and it’s important to understand this as you don’t want to either count something that shouldn’t be or miss something out and be hit with a big bill down the line or/and a fine from HMRC.
To find out exactly what is considered please check out the the HMRC page which explains this in more details, but in essence there are plastics which will be considered as single use by the end consumer, or there are plastic that are used within the supply chain. Let’s take a simple example, you’re a business that imports blueberries, these come in plastic packaging, this packaging itself may be subject to this plastic packaging tax.
Plastic packaging tax exemption
Think you may qualify for plastic packaging tax exemption then you need to be certain of this, even if you’ve read the HMRC guidance and think you fit the exemption criteria it may be worth getting a second opinion from an accountant or even to call HMRC and get confirmation that you are exempt (it may be worth asking for this in writing to cover yourself in the future)
Can I do this myself?
As with most taxes and accounting related processes that HMRC implement, they are not designed to be done by people who don’t have experience in, this in particular is quite a complex tax where different products will be exempt and some that will be covered which you may think won’t be taxed. It is therefore vital to talk to an accountant about this.
Here at Velocity Accounting, we can help give you advice and manage processes relating to this, so feel free to get in touch with us and we can help you understand it in more detail and help to investigate what may or may not count towards it within your business.
