Find out what is aggregates levy and how to manage its impact on your business
Aggregates levy explained
Aggregates levy is a tax on the commercial exploitation of rock, sand and gravel. It applies to imported materials as well as quarrying and mining activities. It can also apply to construction activities where material is removed or moved around and reused on site. The rate of aggregates levy is £2 per tonne.
Changes to aggregates levy
There are two changes to the levy which will come into effect on 1 April 2023.
Firstly, a number of aggregates levy exemptions will be simplified. This will mean that unavoidable aggregate resulting from the construction or improvement of any structure or infrastructure related to transport or utilities will become exempt from the charge.
Secondly, aggregate taken from a borrow pit and returned unmixed to the site it was won from is only non-taxable if it is used for quarrying/mining, agriculture or forestry.
Support for businesses
At Evelyn Partners, we have a specialist team who are experienced in all aspects of aggregates levy. We can help affected businesses to understand the full impact of the April 2023 changes and how to manage them.
For more information about how we can help you and your business manage aggregates levy, contact one of our team today.
Frequently asked questions about aggregates levy
What is a borrow pit?
A borrow pit is a common term used to describe a small local source of aggregate. For example, a small sand and gravel pit, near or within a construction site. Borrow pits are often used in large infrastructure projects such as roads, railways, reservoirs, pipelines, and wind farms to reduce transport of materials and reduce the impact of traffic movements through local communities.
What aggregate is exempt from aggregates levy tax?
There are a number of aggregates exempt from aggregates levy including clay, soil and organic or vegetable matter, material from dredging watercourses, drill cuttings, and aggregate removed from some construction sites.
The list of exemptions is vast. For full details, please refer to HMRC or contact our specialist aggregates levy team.
What reliefs are available on aggregates levy?
Some aggregate is eligible for tax relief, including aggregate:
- Exported from the UK
- Treated as waste and disposed of
- Used in a process which is exempt from the levy
- Used in a specified industrial or agricultural process which is eligible for relief