This guidance reflects provisions in Part 4 of the Landfill Disposals Tax (Wales) Act 2017 (LDTA).
LDTA/6000 Unauthorised disposals
Landfill Disposals Tax (LDT) is chargeable on taxable disposals and what is treated as a taxable disposal is governed by Part 2 of the Landfill Disposals Tax (Wales) Act 2017 (LDTA). The following guidance should be read in conjunction with our guidance on taxable disposals at LDTA/2010-LDTA/2020.
A disposal of material as waste made after 1 April 2018 may be liable to LDT regardless of whether the disposal is made at an authorised landfill site or elsewhere. Part 4 of the LDTA (sections 46 to 53) establishes liability to LDT for a disposal made outside of an authorised landfill site (an unauthorised disposal). This liability arises where the WRA is satisfied that the charging condition is met and issues a charging notice.
These provisions potentially bring a wide range of activities within the scope of LDT, from large-scale, organised disposal sites run outside the relevant environmental and waste regulatory framework, to lower level, ad hoc fly tipping. The WRA does not anticipate using this procedure in relation to littering.
The introduction of a separate tax rate for unauthorised disposals is aimed primarily at deterring unauthorised disposals rather than raising tax revenue. The WRA will be responsible for determining the level of compliance and enforcement activity it undertakes in relation to unauthorised disposals. It is anticipated the WRA’s focus will be on larger unauthorised waste sites and may also extend to regular and persistent fly-tippers.
LDTA/6010 The charging condition
A person may become liable to LDT on an unauthorised disposal either where they made the disposal, or where they knowingly caused or knowingly permitted the disposal to be made.
Ordinarily, it will be for the WRA to establish that a person made or knowingly caused or knowingly permitted the disposal to be made (or for that person to inform WRA that they did so). However, in some circumstances, it will be presumed that a person knowingly caused or knowingly permitted the disposal. This is where, at the time of the disposal:
- a person controlled or was in a position to control a motor vehicle or trailer from which the disposal was made, or
- a person was the owner, lessee or occupier of the land on which the disposal was made.
If the circumstances above are established, the WRA does not need to show that the person did, in fact, knowingly cause or knowingly permit the disposal to be made; the charging condition will be presumed to be met unless the person satisfies the WRA (or the tribunal) otherwise.
In considering whether a person has overturned the presumption that they meet the charging condition, it is anticipated that the WRA will take account of a number of factors, including whether the person:
- took reasonable efforts to prevent the waste from being dumped on their land (e.g. sturdy fencing)
- took reasonable efforts to have the waste removed (e.g. contacted a registered waste carrier regarding removal)
- actively assisted in any (potential) environmental action against the offenders (e.g. contacted the police, local authority or NRW about the waste and/or helped them in their investigations)
- had no knowledge of the waste, and couldn’t reasonably have had knowledge (e.g. given where the waste was deposited, the size of estate etc.)
- was ill or otherwise incapacitated.
This is not an exhaustive list of relevant factors and the WRA will consider the full circumstances of a disposal and the evidence available in deciding whether it is satisfied that the presumption is overturned in any individual case.
LDTA/6020 The procedure
Ordinarily, there will be a two-stage procedure for establishing liability to LDT for unauthorised disposals: a preliminary notice and a charging notice. However, in some circumstances, the WRA may issue a charging notice, without having issued a preliminary notice. If the WRA issues a charging notice, whether or not preceded by a preliminary notice, the liability to LDT is established as set out in that notice.
The WRA may issue a preliminary notice to a person where it appears that one or more unauthorised disposals have been made and the person meets the charging condition.
The preliminary notice must do the following:
- Identify the land where the taxable disposal appears to have been made
- Describe the circumstances of the disposal and the nature of the material being disposed of (as far as possible)
- State when the disposal was made (or when it has estimated to have been made)
- Explain why the WRA feels that the person meets the charging conditions
- State the amount of the proposed tax due and how that amount has been calculated
- State that, after 45 days (beginning on the day after the notice is issued), the WRA may issue a charging notice, but that the person can ask for this period to be extended or make any written representations before the charging notice is issued
A preliminary notice may relate to more than one taxable disposal or to an unascertained number of disposals. It cannot be issued more than 4 years after the WRA became aware of any of the taxable disposals referred to in the notice. A preliminary notice cannot be issued in relation to a disposal that appears to have been made more than 20 years ago.
Charging notice following a preliminary notice
Where a preliminary notice has been issued, after 45 days (or such other deadline as may have been agreed), the WRA must either:
- issue a charging notice, or
- inform the person that it does not intend to issue a charging notice, in relation to the disposal or disposals identified in the preliminary notice.
The WRA may only issue a charging notice where, it is satisfied that an unauthorised disposal has been made and that the person meets the charging condition.
The WRA must consider any written representations received by the person following receipt of the preliminary notice in determining whether to issue a charging notice.
The charging notice must do the following:
- give details of the taxable disposal(s)
- explain why the WRA is satisfied that the person meets the charging conditions
- state the amount of tax due and how that amount has been calculated
- inform the person of their right to request a review or to appeal the decision
Charging notice without a preliminary notice
The WRA may issue a charging notice without having first issued a preliminary notice where it is satisfied that an unauthorised disposal has been made and that the person meets the charging condition; and it thinks that there is likely to be a loss of tax if it issues a preliminary notice.
The WRA anticipates following this route where it thinks there is a risk that the person liable to the tax may become difficult to trace or to contact, or may take steps to move assets with which the tax liability could be paid, were they to be made aware of the WRA’s proposal to issue a charging notice.
Where the WRA issues a charging notice under these circumstances, in addition to the information that must be included in any charging notice (see above), the notice must also give the WRA’s reasons for not having issued a preliminary notice.
A charging notice issued without issuing a preliminary notice cannot be issued more than 4 years after WRA becoming aware of any of the taxable disposals referred to in that notice and cannot be issued in relation to a disposal that appears to have been made more than 20 years ago.
LDTA/6030 Amount and payment of tax
The amount of tax chargeable is calculated by multiplying the taxable weight of the disposal in tonnes by the unauthorised disposals rate.
Where the WRA issues a charging notice, the person to whom it is addressed is liable to pay the amount of LDT stated in it within 30 days (beginning with the day on which the notice is issued).
In calculating the amount of tax due on an unauthorised disposal, the WRA will multiply the taxable weight by the unauthorised disposals rate. The rates and bands are set by the Welsh Government.
The WRA will determine the taxable weight by using any method it thinks appropriate. Where accurate and reliable records are maintained these may be used to determine the weight or volume of material that has been deposited on the site. Where we cannot use records, we will use a reasonable method of calculation which will be decided on a case-by-case basis. We will include all constituents of the disposal and will not discount any of the disposal contents such as water weight.
The unauthorised rate applies without distinction to all material disposed of, regardless of whether that material would otherwise be subject to the standard or qualifying rate of tax at an authorised landfill site. None of the exemptions or reliefs that apply to disposals at authorised landfill sites are available to unauthorised disposals.
Where the WRA issues a charging notice, the tax due must be paid within 30 days of the notice being issued. If charging notices are issued to more than one person in respect of the same unauthorised disposal, all of these people are jointly and severally liable for the tax charged. The WRA will consider on a case by case basis how best to pursue a tax liability.