Plastic Packaging Tax - exclude non-commercial activities from 10 tonne limit

03 May 2022      Andrea Marshall, Tax Specialist

We have obtained confirmation from HMRC, that packaging used for non-business or non-commercial activities does not count towards the 10 tonne PPT threshold.  Therefore, it is highly unlikely that any university will be above the threshold.

Question raised with HMRC

Universities do not “finish” plastic packaging, so we are only interested in the 10 tonne limit as it applies to imports.  The question is, can we exclude any CT primary purpose activities from the definition of “commercial purposes” as it applies to PPT?  So that would mean that when importing, universities could exclude imports for academic or publicly funded research purposes? 

A member has raised this question, given this extract in the primary legislation:

43Charge to plastic packaging tax

(1)The charge to plastic packaging tax arises when a chargeable plastic packaging component is—

(a)produced in the United Kingdom by a person acting in the course of a business, or

(b)imported into the United Kingdom on behalf of such a person.

(2)The reference in subsection (1) to “a business” includes any activity of a government department or other public authority, or of a charity, that is carried out for commercial purposes.

HMRC Response

When considering for PPT if an activity is commercial or acting in the course of business, HMRC will align with other taxes like CT or VAT. If an activity is treated as non-commercial, or non-business under these regimes, then that would be sufficient for it to be considered the same for PPT. Therefore, if plastic packaging is imported into the UK by a university for one of these purposes, it would not be in scope of the tax, and would not count towards the 10 tonne threshold when determining if they are liable to register for, and pay, the tax.

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