Landfill tax on waste, and how it is calculated has changed with affect from 1^st April 2016.

HMRC have introduced a ‘Loss on Ignition’ (LOI) testing regime. The aim of this is to ‘help prevent misdescription of waste fines for landfill tax purposes’, thereby increasing compliance.

To help customers meet the HMRC guidance, ALS Laboratories have developed four LOI suites of analysis to cover all requirements. These range from a basic LOI test in line with the guidance, through to a fully compliant suite that includes storage until the following April and a photograph of the subsample:

Analysis for LOI involves taking a sub sample of 1kg from a homogenous waste source, this is then dried until at a constant weight, coned and quartered to produce a 200g sub sample. A 200g section of the sample is then sieved to remove all qualifying material over 20mm with recording the weight of any removed material. The remaining sample is ground to <2mm and a minimum of 20g is dried at 180^oC until at a constant weight before drying at 440^oC until a constant weight is achieved.

Landfill site operators must now test all qualifying fines received from each customer disposing at their sites. This must be done within the time period of which the initial 500 tonnes of waste is delivered to site (or by the 1^st May for existing customers / within a month for new customers).

To download our data sheet on HMRC LOI, please click here.

Qualifying fines with an LOI of 10% or below will be eligible for the lower tax rate (£2.65 per tonne) those above will be required to pay the higher tax rate (£82.60 per tonne). During the first 12 months of this regime the threshold will be set at 10%.

The sampling frequency is dependent on the risk factor of the waste: High (Every Load), Medium (Every 500 tonnes), Low (Every 1000 tonnes). This means that a LOI result that breaches the proscribed limit could result in a £82,600 tax bill compared to a £2,650 one.