Plastic packaging tax

What is taxed

The tax applies to finished plastic packaging components: items that have undergone their last substantial modification and are designed to contain, protect, handle, deliver or present goods. "Plastic" means the component is plastic by weight (plastic is the heaviest material in it). A component is chargeable if less than 30% of its plastic, by weight, is recycled plastic; exactly 30% is not chargeable. The law presumes a component is below 30% unless you can show otherwise, so recycled content claims need supplier evidence.

The rate that applies is the one in force when the component was manufactured or imported, not when the return is filed. The 2027/28 rate has not been announced.

Registering: the 10-tonne tests

You must register with HMRC within 30 days of the day you meet either test:

• Backward test: on the first day of a month, you have manufactured or imported 10 tonnes or more of finished plastic packaging components in the preceding 12 months.
• Forward test: on any day, you have reasonable grounds to expect 10 tonnes or more in the next 30 days.

Both tests count all plastic packaging, including components that are exempt or that contain 30% or more recycled plastic. Tax is due from the day the test is met. Importers count packaging around imported goods (such as the film and trays around products you bring in), not just empty packaging.

Exemptions and exclusions

Components with 30% or more recycled plastic are not taxed but still count towards the 10-tonne threshold and must be reported on returns.

Returns, payment and records

Accounting periods end on 30 June, 30 September, 31 December and 31 March, and the return and payment are due by the last working day of the month after each period:

Returns show the total weight manufactured and imported, the weight that is exempt, the weight with 30% or more recycled content, and the chargeable weight. You can correct errors for up to four years. Records must be kept for six years from the end of the accounting period, including weights, recycled content evidence and the due diligence you carried out on suppliers.

Tip: businesses that buy packaging are not liable, but HMRC expects them to carry out due diligence. Keep supplier statements confirming the tax has been accounted for; if a supplier evades the tax, HMRC can make customers who ignored warning signs jointly liable.

Mass balance and the April 2027 change

Finance Act 2026 made two changes that take effect on 1 April 2027:

• recycled plastic produced by chemical recycling and attributed under an approved mass balance scheme will count towards the 30% test, which should make it easier to source compliant food-contact packaging;
• pre-consumer plastic waste (production scrap) will no longer count as recycled plastic, so only post-consumer recycled content qualifies.

Until then the current definitions apply. Manufacturers relying on pre-consumer regrind to reach 30% should re-check their recycled content before April 2027.

How to comply, step by step

1. Measure your tonnage

   Track plastic packaging manufactured and imported each month, including packaging around imported goods, and run the backward and forward tests.

2. Register within 30 days

   Through your HMRC business tax account once a test is met. Group registration is available for connected companies.

3. Gather recycled content evidence

   Supplier certificates and specifications for every component you claim is at 30% or more; the burden of proof is on you.

4. File quarterly returns and pay

   By the last working day of the month after each quarter, even if no tax is due.

5. Keep six years of records

   Weights, calculations, exemption evidence and due diligence on suppliers and customers.

Penalties

HMRC applies its standard penalty regimes: failure-to-notify penalties for late registration, late filing and late payment penalties, interest on unpaid tax, and inaccuracy penalties based on the behaviour behind an error. Fraudulent evasion is a criminal offence. HMRC also has powers to make a customer secondarily liable where they knew or should have known that a supplier was not accounting for the tax.

How it differs across the UK

E England

A UK-wide tax administered by HMRC; no national differences.

W Wales

A UK-wide tax administered by HMRC; no national differences.

S Scotland

A UK-wide tax administered by HMRC; no national differences.

NI Northern Ireland

A UK-wide tax administered by HMRC; goods moving from Great Britain to Northern Ireland are not imports for the tax.

Key dates

• 30 Oct 2026

  Plastic packaging tax return and payment for July to September 2026

  Registered plastic packaging tax payers EWSNI Quarterly

• 29 Jan 2027

  Plastic packaging tax return and payment for October to December 2026

  Registered plastic packaging tax payers EWSNI Quarterly

• 1 Apr 2027

  Plastic packaging tax: mass balance chemical recycling counts towards 30%; pre-consumer waste no longer counts as recycled

  Plastic packaging manufacturers and importers EWSNI

• 1 Apr 2027

  Plastic packaging tax rate for 2027/28 takes effect (rate to be announced at the Budget)

  Plastic packaging manufacturers and importers EWSNI Annual Proposed

Dates marked “Proposed” are announced or consulted on but not yet law. See the full deadlines calendar.

Fees and charges

Penalties and enforcement

Where to do it: official services

• Check if you need to register for plastic packaging tax Guidance

  The current rate, the 10-tonne tests and the steps to register. HMRC EWSNI

• Register for plastic packaging tax Register or apply

  Register through your business tax account within 30 days of meeting a threshold test. HMRC EWSNI

• Completing your plastic packaging tax return Report or submit

  File quarterly returns and pay the tax due. HMRC EWSNI

• Plastic packaging tax penalties Guidance

  How HMRC penalises late registration, returns and payment. HMRC EWSNI

The law behind this

• Finance Act 2021, Part 2 (plastic packaging tax) EWSNI
• Plastic Packaging Tax (General) Regulations 2022 EWSNI
• Finance Act 2026 (mass balance and pre-consumer waste changes from 1 April 2027) EWSNI

Terms used in this guide

Finished plastic packaging component

A packaging component that has undergone its last substantial modification; the unit on which plastic packaging tax is charged.

Recycled plastic

Plastic reprocessed from recovered material; from 1 April 2027 only post-consumer material and mass-balance-attributed chemically recycled plastic count.

Mass balance

An accounting method that attributes recycled content from a mixed input across outputs, allowed for chemically recycled plastic from April 2027.

Substantial modification

A manufacturing step that changes a component's shape, structure, thickness or weight; the last one determines who is the manufacturer.

Full glossary