HMRC clarifies rules on landfill tax increase for inert materials


Some waste materials will still qualify for the lower rate of landfill tax, according to a newly released clarification from HMRC.

On 18 May, HMRC issued a briefing note that many in the waste industry saw as meaning that fines from sorting facilities that previously attracted a £2.50 landfill tax for inert material, would now be subject to the full £64 rate. Material that was used to cover landfill sites would also increase to the full £64 rate from £2.50.


However, HMRC said that there had been a “misunderstanding” of the original note and was seeking to clarify as this “has created difficulties in the market, causing the costs of waste transfers to rise unnecessarily”.

The brief confirms that:

  • Material within the so-called reverse or top fluff layer falls within the scope of the landfill tax. The rate of tax applied to this material would be dependent on whether the material as listed in the Landfill Tax (Qualifying Material) Order 2011 (SI 2011.1017) – the 2011 Order. HMRC said that its understanding of these layers is that the material in these layers would not meet the 2011 Order and would therefore be liable to the standard £64 rate.
  • If the material was rocks or soil, and did not contain contaminants such as asbestos, wood, and plastic, or heavy levels of chemicals, and met the 2011 Order, then they would be charged at the £2.50 rate.
  • When it comes to materials from waste transfer stations and from recovery facilities that are sent to landfill, the lower rate will apply if the materials are listed in the 2011 Order, meet the relevant conditions, and can be demonstrated as within the Order and meeting the conditions with the appropriate evidence.


As a result, in order to qualify for the lower rate, the load must not only be of material listed in the 2011 Order, but also described in a manner that clearly evidences that fact on a waste transfer note, and/or any other commercial documentation.

The briefing note states that “mixed loads, for example, containing residues from waste transfer stations, trommel fines and screenings are variable in their nature and it is difficult to determine their exact content and origin. These therefore are not qualifying materials listed in the Order. We are aware from studies undertaken by the [Environment Agency] that fines and other residues from waste transfer operations and construction and demolition waste processing, contain variable quantities of organic waste, sometimes significant quantities of gypsum and other contaminants including asbestos…

“… Materials that fall outside those listed within the 2011 Order, or fail to meet the necessary conditions (for example, if they contain contaminants such as those described above) or are not accompanied with the suitable evidence, would be liable for the standard rate of landfill tax if disposed to landfill.”