Gerry Surtees Chartered Tax Adviser

The Plastic Packaging Tax (PPT) came into effect on 1st April 2022 and is designed to improve the use of recycled plastics in packaging. In this article, Gerry briefly explains the tax and the steps you should take to register if it applies to your business. 

The tax, which is calculated at £200 per metric tonne, applies to finished plastic packaging made or imported into the UK where the plastic used contains less than 30% of recycled plastic. 

Finished plastic packaging is defined as packaging that is fully or partially complete and covers various items such as: -

  • Bin bags
  • Ready meal containers
  • Drinks bottles
  • Sandwich bags
  • Re-useable plastic boxes
Does it apply to your business?

If your business falls into either of the categories below, then you must register for PPT: - 

  • Where the manufacture or import of finished plastic packaging reaches 10 tonnes or more in the following 30 days. You should ensure that you register for PPT within 30 days of the first day that this condition is met.
  • If your business has imported or manufactured 10 tonnes or more of finished plastic packaging within 12 months ending on the last day of a calendar month, then you become liable for PPT from the first day of the following month e.g., if you reach the threshold on the last day of June, you must register within 30 days – 31st July.  

Your business is only required to register for PPT once the plastic packaging reaches 10 tonnes or more in a 12-month period.

How do you register?

You can register for PPT via the government gateway link here https://www.tax.service.gov.uk/register-for-plastic-packaging-tax/start-registration?_ga=2.67964497.1920602240.1649165524-1106276129.1649165524

What you’ll need

You’ll need to give one of the following pieces of information about the estimated weight of finished plastic packaging components. The amount you:
expect to manufacture or import in the next 12 months / have manufactured or imported since 1 April 2022 / expect to manufacture or import in the next 30 days.

After you’ve registered

If you need to complete a PPT return, you should make sure that you keep records and accounts.
If your circumstances change or you have entered wrong information
You will need to access the online service to amend the information within 30 days of either the day:
you discover that the original information you provided is wrong
the change in your circumstances

Creating invoices

The requirement that was due to come into force in April 2022 to include a statement with your invoice to show that PPT has been paid, has been delayed and more information will be shared in due course.

Charging VAT

PPT is only paid once when the packaging component is finished or imported. It is not passed down the supply chain as a separately identifiable charge like VAT.

VAT will continue to be payable on the whole price charged for the goods you sell according to VAT rules.

If you increase the price of plastic packaging because of PPT, VAT will be payable on the whole of the new price.

For more information on how we can help you and your business, please email us at info@oldfieldadvisory.com or call 02476673160.

Please note: This article is provided for information only and was correct as at time of writing (10/04/22). Any lists and details provided above are not exhaustive and are not intended to be full and complete guidance.  No action should be taken without consulting detailed legislation or seeking independent professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this article can be accepted.