In the corporate world, ‘packaging’ is anything used to hold, protect, handle, deliver, and present goods – from raw materials to finished goods.
You are legally considered to have packaging producer responsibility if your company meets both of the following criteria:
• Your company has handled at least 50 tonnes of packaging materials in the last calendar year
• Your company has a turnover of more than £2million per annum.
When calculating if you meet the 50-tonne threshold, you don’t need to include any packaging material you export or have given to someone else to export. You do need to demonstrate what packaging you have exported.
If your company is part of a group, you should add up the total packaging handled and total annual turnover of each of the companies to see if you have packaging producer responsibility.
If you are a holding company and have two or more subsidiaries that handle packaging, or both you the holding company and at least one subsidiary handle packaging, you are classed as a group.
You are classed as a small producer if you have a turnover of between £2-5million, or less than £2million if you are part of a company group that does have an obligation.
‘Handling’ means meet all the following criteria:
You are not considered to be handling packaging if you use packaging materials internally, within your business.
Every year, obligated packaging producers should:
As at March 2024, the charges to register as a producer are £776 and £562 for a small producer.
When you join a compliance scheme, it must pass on your registration fee to the appropriate regulator. The scheme’s charges are currently:
There is no charge for a small producer subsidiary using the allocation method.
By law, obligated packaging producers must follow a set of rules designed to ensure that your packaging practices meet a minimum eco-friendly threshold.
According to the Producer Responsibility Obligations (Packaging Waste) Regulations 2007, obligated packaging producers must follow rules which help to:
These rules are in addition to your duty of care when it comes to business waste.
Once you register as an obligated packaging producer, you must meet your legal obligations. If you fail to do so, or provide false or misleading information, you could face serious penalties and even criminal prosecution.
As well as material losses, businesses found not to be in compliance with rules designed to protect people and the environment could face reputational damages, as well as the revocation of licenses or permits that may hurt your business in the long-run.
It’s therefore crucial businesses follow the packaging practice rules set out by the government. Always consult legal professionals or regulatory authorities if you’re ever unsure.
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Alison Wild BCom (Hons), FMAAT, MATT, Taxation Technician is a highly respected industry professional who has been working with and advising SMEs in areas including tax, pensions, insurance and marketing for over 25 years. She is a Fellow member of the Association of Accounting Technicians (AAT), a member of the Association of Tax Technicians (ATT) and also has 20 years' experience as a residential landlord.
Date: July 11, 2024
Category: Small Business