HM Revenue and Customs Brief 38/14 - compulsory charge on single use carrier bags in Scotland
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Published 16 October 2014
- from 20 October 2014 the Scottish Parliament will introduce
a compulsory charge on single use carrier bags provided with goods
supplied in or from Scotland
- this is not a HM Revenue and Customs measure. However,
there are implications for VAT, Corporation Tax and Income Tax
- this brief explains the basics of the charge and the tax
Who needs to read this?
Suppliers of goods in Scotland who sell or deliver goods using
single use carrier bags.
The Scottish Parliament is to introduce a compulsory charge on
single use carrier bags set at a minimum of 5 pence. This charge will
apply on single use carrier bags supplied with goods, supplied in or
delivered from Scotland. The legislation takes effect from 20 October
- where suppliers are liable to charge VAT, the amount they
charge for a bag is tax inclusive at the standard rate of VAT. For a
VAT registered business charging 5 pence, the taxable amount will be
4.17 pence and the VAT 83 pence
- suppliers using a Retail Scheme should ensure that VAT is
properly accounted through their scheme
- non-VAT registered suppliers must still charge the same
minimum amount of 5 pence
Direct tax implications
- for Corporation Tax and Income Tax, receipts from the
compulsory charge on single use carrier bags should be brought into
account in calculating trading profits
- the Scottish Government expects the proceeds to fund good
causes in Scotland. Relief may be available where the normal charitable
donations/gift aid rules are met
Information about how the charge will operate is available
from the Scottish
About the Author
© Crown Copyright 2014.
A licence is needed to reproduce this article and has been republished
for educational / informational purposes only. Article reproduced by
permission of HM Revenue & Customs.
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Article Published/Sorted/Amended on Scopulus 2014-10-21 09:00:00 in Tax Articles
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