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Who needs to pay the Plastic Packaging Tax?


The Plastic Packaging Tax (PPT) applies to businesses that manufacture or import relevant plastic packaging components or import packaged goods into the UK.

PPT was introduced on 1 April 2022 to incentivise the use of recycled material in the production of plastic packaging.

What does my business need to do in order to comply with PPT?

If your business has placed more than 10 tonnes of relevant plastic packaging onto the UK market in the past 12 months then you need to be registered with HMRC for PPT. In fact, HMRC advises that even if you do not meet the liability to register and report your plastic packaging for the tax, you should keep records to demonstrate this.

If you are caught by HMRC’s criteria you will be liable to pay £200 per tonne of plastic packaging that does not contain at least 30% recycled content.

Although not currently a legal requirement, most businesses incurring the PPT charge are passing this on to their business customers.

Your business should prepare for quarterly reporting and payments. Accounting periods are 1 April to 30 June; 1 July to 30 September; 1 October to 31 December and 1 January to 31 March.

Are there any exemptions to the Plastic Packaging Tax?

Small operators who import or manufacture less than 10 tonnes of plastic packaging per year are exempt from paying the tax. Additionally, the following packaging components are exempt from the tax, regardless of how much recycled plastic they contain:

  • Plastic packaging manufactured or imported for use in the immediate packaging of a medicinal product
  • Transport packaging used on imported goods
  • Packaging used as aircraft, ship and rail stores
  • Components that are permanently designated or set aside for use other than a packaging use.

As ever, detail is all, so you need to make sure that the plastic does or does not fall within PPT.

What action do businesses need to take now regarding Plastic Packaging Tax?

As a priority you need to check if the packaging you manufacture or import is subject to the tax. You then need to work out the weight of the packaging so that you know if you need to register for the tax.

It is essential that you have the systems in place to enable necessary data collection and reporting. There is also likely to be a requirement to take a closer look at your supply chains in order to re-examine contracts and pricing.

Initially the UK government estimated 20,000 businesses, including retailers, manufacturers, publishers and importers would be affected by the PPT. Recent news reports shows that the number of PPT registrations is about 5% of this estimate. Therefore, planned revenue generation is unlikely to be met and HMRC may look to investigate businesses that they believe should be registered for PPT. Where a business has failed to register penalties are likely to apply.

If you are in the business of manufacturing, selling or buying plastic packaging and need assistance, please get in touch with Ian Marrow .

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