HM Revenue and Customs Brief 5/15 - Levy tax credits in Northern Ireland
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Purpose of this brief
Revenue and Customs Brief 41 (2014) gave details about the
introduction of an 80% Aggregates Levy credit for aggregate
commercially exploited in Northern Ireland (NI) following its
importation from another European Union (EU)
member state between 1 April 2004 and 30 November 2010 (‘the relevant
period’). This brief gives further information about how the scheme
2. Who needs to read
Anyone who accounted for Aggregates Levy at the full rate on
aggregate that was commercially exploited in NI between 1 April
2004 and 30 November 2010 following importation from another EU member state.
The Aggregates Levy Credit Scheme (ALCS)
provided an 80% levy credit to operators in NI who commercially
exploited aggregate originating there, provided they entered into an
agreement with the Department of Environment (DoE) in NI to improve
environmental standards at their site(s). The scheme operated from 1
April 2004 to 30 November 2010. It was suspended from 1 December 2010
while the Commission undertook a State aid investigation into the
scheme. This suspension was outlined in Revenue and Customs Brief 42
The Commission completed its investigation into the ALCS in
November 2014. Although broadly content that the scheme complied with
the prevailing rules, it expressed concern that the tax benefit arising
from the ALCS
did not apply to aggregate commercially exploited in NI that originated in
member state. The Commission’s decision required the UK to introduce a
new scheme to correct this distortion.
In response to the Commission investigation, Revenue and
Customs Brief 41 (2014) was published on 17 November 2014. Draft
primary legislation providing for the scheme needed to correct the
distortion was published on 10 December 2014 with draft secondary
legislation released to the NI
industry in February 2015. The primary legislation was included in
Finance Act 2015 and the secondary legislation comes into force on 1
This brief updates Revenue and Customs Brief 41 (2014) to give
further information about the scheme.
4. How will the new
As the new scheme is comparable with the ALCS, the
conditions for entitlement under it are similar to the requirements
members had to meet between 2004 and 2010. Therefore a claimant under
the new scheme must satisfy the DoE that, for
aggregate that was commercially exploited in Northern Ireland between 1
April 2004 and 30 November 2010:
- it obtained the aggregate from a quarry or quarries in
member state, and
- the quarry or quarries met standards comparable with the
requirements of the ALCS
Once the environmental standards of the quarry have been
confirmed by the DoE
by the issue of a certificate, the claimant can apply to HM Revenue and
for a repayment of the levy paid on the aggregate.
5. How can I show that
the quarry met the necessary environmental standards?
To get an environmental performance certificate from the DoE you must
complete form DOE
STC1, which you can download from the DoE website.
A separate form must be completed for each quarry you imported
aggregate from during the relevant period. This form provides the DoE with
details about the quarry and the aggregate you obtained. If, following
investigation, the DoE
deem the quarry’s environmental performance to have been satisfactory
at the time the aggregate was purchased, they will issue a certificate
to you. You will need this certificate to support your claim to HMRC for a
credit of tax.
6. When can I submit
the form(s) to the DoE
and where do I send it ?
You must submit the form(s) by 31 March 2016.
Guidance is also available on the DoE website
about how to complete the STC1 form.
If you can’t download the form, you can write to DoE at the
address below to request copies indicating how many forms you need
(namely how many quarries in other member states you obtained aggregate
from in the relevant period on which you wish to claim credit). The
completed forms should be returned by 31 March 2016 to:
Department of the Environment
Environmental Policy Division
6th Floor, Goodwood House
44-58 May Street
7. How do I apply for a
After you receive a certificate from the DoE you
should apply to HMRC
for a credit of any levy paid at the full rate during the relevant
period covering aggregate from the quarry covered by the certificate.
Any claim for tax credit made without a valid DoE
certificate will be rejected. All credit claims must be made in writing
no later than 31 March 2019 to:
HM Revenue and Customs
Aggregates Levy Team
Chillingham House, Room BP4002
Benton Park View
Newcastle upon Tyne
You will need to:
- attach a copy of the certificate you have received from the
- identify the Aggregates Levy return on which the levy was
- provide a ledger breaking down the entries in box 1 of the
Aggregates Levy return and identifying the entry for which credit is
- provide commercial evidence of purchase and subsequent
importation of the aggregate
If you wish to claim levy credit - and the aggregate was
obtained from more than one quarry in another member state - you can
either send in your claims separately when you receive each certificate
from the DoE
or you can send one claim (providing you attach the correct number of DoE
certificates). However, if your claim covers aggregate from more than
one quarry you must separately identify all the information set out in
the bullets above for each quarry.
If all relevant information is provided we will normally
process your claim within 30 days. Failure to provide the necessary
information will lead to delays while we seek the missing information
Where we decide that your claim is valid, we will pay interest
on the sum repayable from the date the aggregate was commercially
8. I am not currently
registered for the Aggregates Levy with HMRC – do I need
to register or re-register?
No. Since these claims are historic, there is no need to be
registered for the levy to claim a credit under this scheme.
9. I am registered for
the levy – can I offset any credit as a result of the new scheme on a
No. This scheme is being implemented in response to a
Commission State aid investigation and repayments made under it need to
be clearly identifiable from any continuing liabilities.
10. Will aggregate
imported into NI
from other parts of the UK be eligible for these levy credits?
No. The ALCS
aimed to help those operating in the specific circumstances that
applied in the NI
aggregates market. If an NI
operator bought aggregate from a quarry elsewhere in the UK it would
not have been the NI
operator that would have had to pay the levy at the full rate but the
quarry in Great Britain ‘exporting’ the material to NI. It was not the
intention of the original scheme to support the quarry in Great Britain
and therefore not the intention of the new credit.
Relief, however, will be claimable by registered quarry
operators in the rest of the UK on aggregate obtained from another
member state which then became taxable as the result of becoming
subject to an agreement to supply to a person in NI.
11. Further information
If you have any further questions please contact Catherine
Osborne on Telephone: 03000 536971 or email
About the Author
© Crown Copyright 2015.
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 2015-06-03 09:09:45 in Tax Articles