HM Revenue and Customs Brief 45/14 - devolution of Landfill Tax to Scotland
Submit Articles Back to Articles
Purpose of this Brief
The purpose of this Brief is to expose draft legislation on
the devolution of Landfill Tax to Scotland on 1 April 2015 and on the
arrangements for the transitional period for the Landfill Communities
It also provides information about what happens at the end of that
Who needs to read this?
registered landfill operators
Environmental Bodies (EBs),
including distributive EBs,
authorised under the LCF
Landfill Tax is to be devolved to Scotland on 1 April 2015.
Landfill operators with sites in Scotland will no longer be liable to
pay UK Landfill Tax for waste disposed at their Scottish sites.
Landfill operators with sites only in Scotland will be deregistered
from UK Landfill Tax. Landfill site operators with sites in both
Scotland and elsewhere in the UK will continue to pay UK Landfill Tax
on their non-Scottish sites. Landfill operators with sites in Scotland
will be required to register with Revenue Scotland and account for
Scottish Landfill Tax on disposals in Scotland, further information is
available on the Revenue Scotland website.
From 1 April 2015, UK landfill operators will only be entitled
to claim credit for qualifying contributions to the UK LCF if they
are spent on projects in England, Wales or Northern Ireland. Scotland
is introducing its own scheme, and operators in Scotland will be able
to claim tax credit against their Scottish Landfill Tax liability for
contributions they make to the Scottish scheme.
may hold unspent funds from contributions from landfill site operators
throughout the UK when the tax is devolved. There will be a 2 year
transitional period during which these unspent funds can continue be
spent on projects throughout the UK, including in Scotland.
Landfill Tax switch-off
UK Landfill Tax is to be paid on all disposals up until 31
March 2015 even if the invoice is issued at a later date.
will the 2 year transitional period operate?
Landfill Tax Briefing – March 2014, which was sent to all
registered landfill operators on 19 March 2014, provided an outline of
the scheme. ENTRUST has also published information on its website.
will continue to be allowed to spend funds held at 31 March 2015 on
projects in Scotland during the transitional period, that is up until
31 March 2017. During this period EBs
will also be able to transfer funds to other EBs intending to
fund projects in England, Wales and Northern Ireland, who will be able
to continue to spend these funds after the end of the transitional
At the end of the transitional period EBs who fund only
projects in Scotland will no longer be able to spend UK LCF funds
compliantly. Changes to the Landfill Tax Regulations will allow the tax
credit claimed by landfill operators relating to remaining funds to be
clawed back by HM Revenue and Customs (HMRC). Landfill
operators must keep records and accounts to ensure that their
contributions to EBs
are spent compliantly. HMRC
will require these records to verify contributions are to be clawed
At the end of the transitional period some EBs will continue
to fund projects in the rest of the UK under the LCF and also
fund projects under the new Scottish LCF. Those EBs will be able
to continue to use LCF
funds held at 31 March 2017 on projects being carried out in England,
Wales and Northern Ireland. They will be entitled to use a proportion
of these remaining funds to meet their running costs, but only in
proportion to costs attributable to the carrying out of approved
objects in those parts of the UK.
The Landfill Tax regulations are being amended so that any LCF funds
invested after the date of the legislation will be considered as
unspent funds at the end of the transitional period and subject to
Changes to legislation
The Landfill Tax Regulations 1996 will be amended by the
Devolution of Landfill Tax (Consequential, Transitional and Savings
Provisions) Order 2015.
If you would like to make any comments about the draft
legislation please email Catherine Mawer by 23 January 2015.
The changes will come into effect from 1 April 2015.
If you require further information please contact the Excise
and Customs helpline on Telephone: 0300 200 3700.
Draft Legislation: The Devolution of Landfill Tax
(Consequential, Transitional and Saving Provisions) Order 2015
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.
Follow us @Scopulus_News
Article Published/Sorted/Amended on Scopulus 2014-12-16 11:00:23 in Tax Articles