Landfill tax

Learn how landfill tax works and the discounts available to your business.
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Landfill tax is charged on waste disposed of on a landfill site, illegally elsewhere, or without an appropriate environmental permit.

It is a devolved tax, so separate regimes apply to businesses in England and Northern Ireland, Scotland and Wales.

Landfill tax rates

There are two rates of landfill tax:

  • The lower rate of £4.05 per tonne on certain inert materials such as soil, brick and concrete
  • The standard rate of £126.15 per tonne on everything else

All illegal or unauthorised disposals are subject to the standard rate, except in Wales, where an additional 50% is added.

The rates increase annually to account for inflation.

Landfill tax water discount

Businesses that generate waste with added water can claim a landfill tax water discount on materials sent for disposal if they obtain a water discount agreement from HMRC, Revenue Scotland or the Welsh Revenue Authority. Water discounts can be extremely valuable for some industrial processes.

You can apply for a water discount when water was:

  • Added to waste to allow it to be transported for disposal
  • Used for the extraction of minerals
  • Added during an industrial process and the water content is 25% or more by weight

Once your application has been approved, HMRC will issue an agreement stating the percentage of landfill tax discount you will receive. The agreement will also contain conditions you must comply with.

You will need to provide your landfill site operator with the details of the water discount.

Support with landfill tax

S&W is a proud member of the Environmental Services Association (ESA), the leading trade association representing the UK’s resource and waste management industry.

We can help you with all aspects of landfill tax, including applying for and claiming the landfill tax water discount. Our experts have extensive experience dealing with landfill tax to ensure you pay the right amount. From tax authority enquiries, assessments, and disputes to appeals to the tax tribunal, we can help.

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Frequently asked questions about landfill tax

Landfill tax was introduced in October 1996 by the UK Government to encourage businesses that produce a substantial amount of waste to adopt a more environmentally sustainable approach to its disposal.

If HMRC, Revenue Scotland or the Welsh Revenue Authority find that waste has been disposed of outside of an authorised landfill site, they can charge landfill tax on the illegal disposal.

This can happen inadvertently, such as when material has been stored for longer than planned, or if material deposited during a redevelopment contains something different to what was originally intended.

Everyone in the disposal chain (including the landowner) can be held jointly and severally liable for the tax assessed on the illegal disposal.

The lower rate of tax is only available for two types of materials:

  • Qualifying materials listed in the Landfill Tax (Qualifying Material) Order 2011 (and its Scottish and Welsh equivalents)
  • Qualifying fines or mixtures of fines, which are particles that arise from the mechanical processing of waste

The intention is that only material with low pollution potential qualifies for the lower tax rate. Prescriptive requirements govern the amount of contamination present and the evidence and testing required for qualifying fines.