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Plastic Packaging Tax: Who and When to Register

December 27, 2022

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By 2023, the Plastic Packaging Tax, popularly known as the PPT, will go into effect.

The PPT is intended to encourage the adoption of recycled plastic.

The tax, levied at £200 per metric tonne of plastic packaging, will apply to plastic packaging created in or imported into the United Kingdom in which less than 30 percent of the plastic used in its production was recycled.

For instance, if your company produces 100 metric tons of plastic packaging a year and two metric tons contain less than 30% recycled plastic, you will be required to pay £400.

Who Needs to Register for PPT?

You are required to register for PPT in the following instances:

  • We expect to import or produce at least 10 metric tons of completed plastic packaging materials in the United Kingdom within the next 30 days.

  • manufacturing or importing more than 10 tons of completed plastic packaging components into the UK since April 1, 2022.

Those who are not UK residents but yet manufacture or import completed plastic packaging components are included in this category.

In most cases, the importer will be listed as the consignee on the import documentation, unless the importer can prove that they are operating on behalf of the import's controller and are utilizing the consignee as a storage facility.

Make sure you and any other firms dealing with your incoterms-delivered completed packaging components imports understand who is responsible for tracking the Plastic Packaging Tax. It is not until the items are imported that the tax becomes due; nevertheless, it is paid quarterly in arrears.

You must register as a company if at least one of your partners (or an individual doing business) will produce or import 10 tons or more of completed plastic packaging components during the next 30 days or after April 1, 2022.

Everyone will subsequently be held equally (jointly and severally) responsible for paying the plastic packaging tax.

Registration is also available on a group basis for commercial organizations. Because of this, just one company has to file returns and make payments on behalf of the whole conglomerate.

When Should You Register?

Within 30 days of being responsible for the plastic packaging tax, you are required to register. Beginning on the day you are required to register, you are responsible for paying tax on all taxable items. Depending on the circumstances, you can be required to pay a fine.

Before you register, here are the things that you must consider first:

  • Consider the following 30 days to see whether you anticipate meeting or exceeding the 10-ton benchmark.

Producing or importing 10 metric tons or more of completed plastic packaging components during the next 30 days requires registration. At any moment, you may do this test.

If there is a reasonable expectation that you would hit or exceed the 10-ton level, your liability will begin on the day you knew or should have known you would approach that threshold.

If you have reached or are over the barrier, you have 30 days to register.

  • Check how many finished plastic packaging components you created and imported on April 1, 2022. This will change on March 31, 2023, when you will be required to review the previous 12 months on the last day of each month.

If your company produced or imported 10 metric tons or more of completed plastic packaging components in the previous calendar year, you are required to register.

For the last 12 months, you need to track how much final plastic packaging components you imported and made. Once you pass the 10-ton mark, your liability will begin on the first day of the month following the month in which you crossed the mark.

If you have reached or are over the barrier, you have 30 days to register.

Due to the fact that the tax isn't applied until 1 April 2022, the results of this test change between 1 April 2022 and 30 March 2023. You need only consider the past as of April 1st, 2022.

When You Meet the Conditions

If you satisfy one of these conditions, you must register for the tax, and if you satisfy both conditions, you must register at the earliest possible date.

If you've achieved the 10-ton barrier, you must include exempt packaging in your calculations.

If you determine that you do, in fact, need to register because you have met one of these two criteria, you should keep track of your reasoning and any supporting documentation.

If you fit both criteria, you must sign up as soon as possible.

To avoid registration fees and scrutiny, only those producing or importing fewer than 10 metric tons of completed plastic packaging per year (including filled packaging) should retain such records.

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