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How the Plastic Packaging Tax works

| Duncan & Toplis | 24 April 2023

The Plastic Packaging Tax (PPT) came into force from 1 April 2022, applying a £200 per tonne tax on new plastic packaging. The rate increased from 1 April 2023 to £210.82 per tonne.

Packaging tax - one year on

The tax requires that businesses that have manufactured or imported 10 tonnes or more of finished plastic packaging components within the last 12 months, or which expect to do so in the next 30 days, will need to register, account for the tax due on quarterly returns and retain detailed records.

The UK generates more than two million tonnes of plastic packaging waste per year, with each person throwing away around 36kg on average - the weight of an 11-year-old child. Despite much of it being recyclable, just 45% of this is actually recycled, with the rest going to landfills or joining the eight million tonnes of plastic in the world’s oceans.

The introduction of PPT was the first step towards making organisations take more responsibility for the packaging they produce and use, in the journey towards a more eco-friendly approach to packaging across the UK.

The next step is to introduce the extended producer responsibility (EPR) reporting so that the full cost of collection, sorting, recycling, and disposal of household packaging waste will be covered by producers rather than the taxpayer.

So what should you be doing to ensure your business is compliant with these regulations?

Work out which of your packaging is subject to PPT

Any polymer material to which additives or substances may have been added is subject to PPT, and this includes polymers that are biodegradable, compostable, or oxo-degradable.

The exception to this is any product that contains 30% or more recycled plastic. This plastic is not chargeable for the tax, however, it will still count towards the 10-tonne registration threshold. There are some other exceptions based on the use of the packaging, including some transport packaging and packaging used for medicinal products.

Work out the weight of the packaging you manufacture or import

This must be calculated in metric values, per component. The five methods which can be used for this are individual component, sample component, material inputs, verified specification or bulk weighing.

Check when you must register for the tax

HM Revenue and Customs (HMRC) PPT registration threshold tests can be found here. These are similar to the VAT registration tests and involve looking back over the past 12 months and forward over the next 30 days. You should ensure that you register for PPT at the required time to avoid penalty charges.

Check what records and accounts you must keep

Records must be kept for at least six years from the end of the accounting period and must include:

  • A breakdown of the weight of any plastic packaging components finished or imported in the period
  • The weight of plastic packaging exported on which relief has been claimed (where applicable)
  • A breakdown of the weight of any plastic packaging for which a credit is being claimed
  • Any adjustments being made to previous periods (which must include the date and period they relate to).

Evidence must be held to support any exemptions claimed or the percentage of recycled plastic content.

Complete your returns and make payment

The returns cover fixed accounting periods, which are the quarters ending 30 June, 30 September, 31 December, and 31 March.

The return for each period must be submitted, and any tax due paid, no later than the last working day of the month following the end of the accounting period being reported. For example, the deadline for the 1 April – 30 June return will be 31 July.


New regulations relating to Extended Producer Responsibility come into effect from January 2024 but businesses need to take action now as these regulations apply to a much wider range of businesses.

Who is affected by the Extended Producer Responsibility?

EPR will apply to businesses that meet all of the following conditions: 

  • you’re an individual business, subsidiary, or group (but not a charity)
  • you have an annual turnover of £1 million or more (based on your most recent annual accounts)
  • you’re responsible for over 25 tonnes of packaging in a calendar year (January to December)
  • you carry out any of the packaging activities listed by HMRC,

Note that the threshold relates to the calendar year, rather than the 12 months immediately prior, and also the higher threshold of 25 tonnes of packaging compared with the Plastic Packaging Tax threshold.

This responsibility relates to all types of packaging and therefore has much wider implications than solely plastic packaging.

Activities affected by EPR

Business that:

  • supply packaged goods to the UK market under your own brand
  • place goods into packaging that’s unbranded when it’s supplied
  • import products in packaging
  • own an online marketplace
  • hire or loan out reusable packaging
  • supply empty packaging

Under the new regulations, you will need to collect and submit data on the packaging you handle and supply and pay a waste management fee. This is calculated by reference to the prior year’s data, which is why records need to be kept from 1 January 2023 or 1 March 2023.

The Environment Agency offers information relating to the new reporting responsibilities including an online service to determine if your business will be required to make these reports in 2024.  

If you’d like advice about the PPT and other taxes, contact us to find out how we can help you.


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