The Climate Change Levy (General) Regulations 2001

Made: 9th March 2001

Laid before the House of Commons: 12th March 2001

Coming into force: 1st April 2001

The Commissioners of Customs and Excise, in exercise of the powers conferred on them by section 30 of and paragraphs 19(1), 19(3), 21, 22, 23(4), 27(7), 27(8), 29(7), 41(1), 41(2), 43(4), 43(5), 44(5), 62, 63(4), 65, 73, 74, 100(2), 100(3), 118, 119, 120, 125, 146(1), 146(4) and 146(7) of Schedule 6 to the Finance Act 2000[^f00001], section 51 of the Finance Act 1997[^f00002], and of all other powers enabling them in that behalf, hereby make the following Regulations:

PART I — PRELIMINARY

Citation and commencement

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These Regulations may be cited as the Climate Change Levy (General) Regulations 2001 and shall come into force on 1st April 2001.

General interpretation

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• (1) In these Regulations and the Schedules, except where the context requires otherwise—

• “the Act” refers to Schedule 6 to the Finance Act 2000;

• “CCL” refers to climate change levy;

• “excluded part”, “exempt part” ... ... and “reduced-rate part” refer, respectively, to that part of a supply of a taxable commodity that would, by itself, be excluded or exempt from CCL or would be ... ... a reduced-rate supply for CCL purposes;

• “gas” refers to gas described by paragraph 3(1)(b) of the Act;

• “Part”, “regulation” or “regulations” refers to the appropriate Part, regulation or regulations of these Regulations;

• “non-registrable electricity producer” refers to an electricity producer to whom a supply of a taxable commodity is not exempt under paragraph 14(1) of the Act (except in relation to uses of the electricity he produces for which that exemption is retained);

• “published notice” refers to a notice published by the Commissioners and not withdrawn by a further notice;

• “recipient” refers to the person to whom a supply of a taxable commodity is made;

• ...

• “registrable person” refers to a person who is registered or required to be registered under Part V of the Act (including, but for regulations 8 and 9 only (records), a person whom the Commissioners exempt from that requirement under Schedule 1 paragraph 5(9));

• ...

• “supplier” refers to a person making a supply of a taxable commodity (but, in the case of regulations 11, 13 and 14, it only refers to the person who is liable to account for the CCL charged on the taxable supply in question (see paragraph 40(1) of the Act—suppliers, and paragraph 40(2) of the Act—supplies made by persons who are neither residents of the United Kingdom nor utilities));

• “time of supply” refers to when a supply of a taxable commodity is treated as taking place by or under paragraphs 25 to 39 of the Act;

• “working day” excludes Saturday, Sunday and any bank or public holiday.

• (2) Where a provision of these Regulations requires the delivery of something to the Commissioners, it must be taken to include a requirement that delivery must be made to any address specified for the purpose in question by the Commissioners in a published notice.

PART II — ACCOUNTING, PAYMENT, RECORDS, TAX CREDITS, REPAYMENTS, SET-OFF, ETC.

Accounting periods

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• (1) A registrable person shall be subject to accounting periods.

• (2) In the case of a registered person, these shall be each three month period ending on the dates notified to him at any time by the Commissioners for this purpose.

• (3) In the case of any other registrable person, these shall be each three month period ending on 31st March, 30th June, 30th September or 31st December.

• (4) However, in a particular case, the Commissioners may vary the start, end and length of any accounting period.

Returns

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• (1) A registrable person is obliged to make a return to the Commissioners covering each of his accounting periods.

• (2) The registrable person is obliged to make that return no later than the last working day of the month immediately following the end of the period to which it relates.

• (3) In the case of an accounting period that does not end on the last day of a month, the registrable person is obliged to make that return no later than the due day directed by the Commissioners.

• (4) The Commissioners may allow the registrable person extra time in which to make that return.

• (5) The registrable person must make that return in a form that is prescribed by the Commissioners in a published notice (“prescribed form”).

• (6) The registrable person must make that return by securing that it is delivered either to the address prescribed by the Commissioners in a published notice or to any other address that they may direct or allow.

Content of returns

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• (1) The registrable person must declare in the return the CCL due from him for the relevant accounting period, taking into consideration—

• (a) the CCL due on taxable supplies—

• (i) the time of supply of which is in that accounting period, and

• (ii) for which he is liable to account;

and,

• (b) any authorised or required adjustment or any correction of errors (see regulations 14(2), 17(3), 27 and 28 and Schedule 1 paragraph 8(1)(b)).

• (2) The registrable person must provide in the return accurate information about every matter that the prescribed form requires.

• (3) The registrable person must sign, date and declare on the document forming his return that the information provided in it is true and complete.

• (4) The registrable person must comply with paragraphs (1), (2) and (3) in the manner prescribed by the Commissioners in a published notice.

Payment

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• (1) A registrable person must pay to the Commissioners the amount of CCL due from him for a given accounting period no later than the due date for the return for that period (see regulations 4(2), 4(3) and 4(4)).

• (2) The registrable person must make that payment by securing that it is delivered either to the address or bank account prescribed for this purpose by the Commissioners in a published notice or to any other address or bank account that they may direct or allow.

• (3) The Commissioners may allow a registrable person who has made arrangements with them for the payment of any amount of CCL due from him by means of direct debit an extra 7 days in which the payment may be made.

• (4) The Commissioners shall only act pursuant to paragraph (3) in accordance with conditions they shall stipulate in a published notice.

Records

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• (1) A registrable person is obliged to keep a record to be known as the “climate change levy account” (periodic summary of CCL due).

• (2) A registrable person who makes a claim under regulations 10 and 14(1) (tax credits in respect of bad debts) is obliged to keep a record to be known as the “climate change levy bad debts account”.

• (3) A registrable person who makes a claim under regulations 11 and 14(1) (other tax credits) is obliged to keep a record to be known as the “climate change levy tax credits account”.

• (4) A record within this regulation must be kept in the manner stipulated in a published notice.

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A registrable person is obliged to keep the following records—

• (a) his business and accounting records;

• (b) a copy of each CCL accounting document issued by him;

• (c) each supplier certificate and supporting analysis document received, issued or prepared by or for him to evidence that a taxable supply (or part of such a supply) by or to him was—

• (i) excluded or exempt from CCL, or

• (ii) a ... ... reduced-rate supply;

• (ca) any record required by or under Part IV(A) (combined heat and power stations);

• (d) documentary evidence (including any relevant invoice) detailing each taxable supply made by him;

• (e) documentary evidence (including any relevant invoice) received by him in connection with his receipt of any taxable commodity;

• (f) documentary evidence regarding the adjustment of an entry concerning the amount of CCL charged for which he is liable to account;

• (g) documentary evidence regarding any claim by him for a tax credit under regulation 10 (bad debts), regulation 11 (other tax credits) or Schedule 1 (tax credit for recipient) and, in each case, regarding any relevant surrounding circumstances;

• (h) the documents relevant to any special utility scheme binding him;

• (i) a record of the information he relies on in making each return pursuant to regulation 5;

• (j) any other record that may be stipulated in a published notice.

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• (1) A registrable person is required to preserve any record required by regulation 7 or 8 for a period of at least six years.

• (2) For the purposes of paragraph (1), a record within regulation 7 need only be preserved in relation to events taking place not more than six years earlier.

• (3) For the purposes of paragraph (1), a record within regulation 8(c) must be preserved by the registrable person for a period of six years from the time of supply of the final supply to which it relates.

• (4) For the purposes of paragraph (1), a record within regulation 8(d) or 8(e) must be preserved by the registrable person for a period of six years from the relevant time of supply or, if there is no such time, from the time of delivery.

• (5) The Commissioners may direct that any such record need only be preserved for such period as they specify shorter than six years.

Bad debts: entitlement to tax credit

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• (1) Paragraph (3) applies where—

• (a) a person has supplied a taxable commodity and has accounted for and paid the CCL chargeable on the supply,

• (b) that person and the recipient of the supply are not connected or are not the same person,

• (c) that person has issued to the recipient a climate change levy accounting document (or, if the issue of such a document is not required by or under the Act, other invoice) relating to the supply showing the CCL chargeable,

• (d) the whole or any part of the price for the supply has been written off in his accounts as a bad debt, and

• (e) the period of 6 months referred to in paragraph (8) has elapsed.

• (2) Any question whether a person is connected with another for the purposes of paragraph (1) shall be determined in accordance with section 839 of the Income and Corporation Taxes Act 1988[^f00003].

• (3) The person shall be entitled to a tax credit in respect of the amount of CCL chargeable calculated by reference to the outstanding amount (subject to the provisions of this Part including those provisions relating to the making of a relevant claim to the Commissioners).

• (4) In this regulation and regulation 16—

• “claim” refers to a claim in accordance with regulation 14 or 15, and “claimant” shall be construed accordingly;

• “the outstanding amount” refers to—if at the time of the claim no part of the price written off in the claimant’s accounts as a bad debt has been received, an amount equal to the amount of the price so written off;if at that time any part of the price so written off has been received, an amount by which that part is exceeded by the amount of the price written off.

• (5) In paragraph (4), “received” refers to receipt either by the claimant or by a person to whom has been assigned a right to receive the whole or any part of the price written off.

• (6) Accordingly, the tax credit arising under this regulation shall be of an amount equal to such proportion of the CCL charged on the supply as the outstanding amount forms of the total price.

• (7) For the purposes of this regulation, where the whole or any part of the price for the supply does not consist of money, the amount in money that shall be taken to represent any non-monetary part of the price shall be so much of the amount made up of—

• (a) the price excluding the CCL chargeable, and

• (b) the CCL charged on the supply,

as is attributable to the non-monetary consideration in question.

• (8) Neither the whole nor any part of the price for a supply shall be taken to have been written off in accounts as a bad debt until a period of not less than six months has elapsed from the time when such whole or part became due and payable to, or to the order of, the person who made the relevant supply.

• (9) Subject to paragraph (8), the whole or any part of the price for a relevant supply shall be taken to have been written off as a bad debt when an entry is made in relation to that supply in the claimant’s climate change levy bad debts account (see regulation 7(2)).

• (10) Where the claimant owes an amount of money to the recipient of the relevant supply which can be set off, the price written off in the accounts shall be reduced by the amount so owed.

• (11) Where the claimant holds in relation to the recipient of the relevant supply an enforceable security, the consideration written off in the account of the claimant shall be reduced by the value of that security.

• (12) In paragraphs (8) to (11), “relevant supply” refers to any taxable supply on which a claim is based.

• (13) In paragraph (11), “security” refers to—

• (a) in England, Wales or Northern Ireland, any mortgage, charge, lien or other security;

• (b) in Scotland, any security (whether heritable or moveable), any floating charge and right of lien or preference and right of retention (other than a right of compensation or set-off).

Other tax credits: entitlement

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• (1) The supplier in each of the following cases is entitled to a tax credit in respect of any relevant amount of CCL charged on the supply in question (subject to the provisions of this Part including those provisions relating to the making of a relevant claim to the Commissioners)—

• (a) after a taxable supply has been made, there is such a change in circumstances or any person’s intentions that, if the changed circumstances or intentions had existed at the time of supply, the supply would not have been a taxable supply;

• (b) after a supply of a taxable commodity is made on the basis that it is a taxable supply, it is determined that the supply was not (to any extent) a taxable supply;

• (ba) a quantity of a carbon price support rate commodity is the subject of a deemed supply under paragraph 24A or 24B of the Act but afterwards the quantity—

• (i) is not used as mentioned in paragraph 24A(1)(b) or 24B(1)(b) of the Act (as the case may be), and

• (ii) is removed from the site at which the station is situated or from the CHPQA site of the station (as the case may be);

• (bb) after—

• (i) a determination is made under Schedule 3 to these Regulations that a quantity, or a proportion of a quantity, of a carbon price support rate commodity is referable to the production of electricity to which paragraph 24B(2A) of the Act does not apply, and

• (ii) it is accordingly determined that the quantity or proportion of a quantity is a subject of a deemed supply under paragraph 24B of the Act,

it is determined that the quantity or proportion of a quantity was not referable to the production of electricity to which paragraph 24B(2A) of the Act does not apply;

• (bc) after an amount is determined to be payable by way of CCL on a deemed supply under paragraph 24A or 24B of the Act, it is determined that that amount is too high;

• (c) after a taxable supply has been made on the basis that it was not ... a reduced-rate supply, it is determined that the supply was (to any extent) ... a ... reduced-rate supply;

• (ca) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (e) after a charge to CCL has arisen on a supply of a taxable commodity (“the original commodity”) to a person who uses the commodity supplied in producing taxable commodities primarily for his own consumption, that person makes supplies of any of the commodities in whose production he has used the original commodity;

• (f) the making of a taxable supply gives rise to a double charge to CCL within the meaning of paragraph 21 of the Act.

• (2) In paragraph (1), “relevant amount of CCL” refers to—

• (a) in relation to a case described by sub-paragraph (a), (b) (bc), (c) (ca) ... or (e) of paragraph (1), the difference between the amount of CCL that ought to have been charged by or under the Act at the time of supply and the amount of CCL that was actually accounted for and paid by the supplier; ...

• (aa) in relation to a case described by sub-paragraph (ba) of paragraph (1), the amount of CCL charged and paid on the deemed supply;

• (ab) in relation to a case described by sub-paragraph (bb) of paragraph (1), the amount of CCL charged and paid on the quantity or proportion of a quantity of the commodity that has been determined as not referable to the production of electricity to which paragraph 24B(2A) of the Act does not apply; and

• (b) in relation to a case described by sub-paragraph (f) of paragraph (1), the amount of CCL actually charged and paid on the later supply having regard to the relative times of supply.

• (3) In sub-paragraph (ba) of paragraph (1) “CHPQA site” has the meaning given in paragraph 24B(7) of the Act.

Tax credits: general

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• (1) The provisions of this Part have effect subject to the requirements of Part III and Schedule 1 (certification scheme for excluded, exempt ... ... and reduced-rate supplies).

• (2) Accordingly, no tax credit shall arise by virtue of regulation 11 where the circumstances are such that provision is made by Schedule 1 for a tax credit, for the benefit of the recipient, relating to the amount in question.

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A tax credit shall only arise under regulation 10 or 11 if a claim is made by the supplier acting in accordance with regulation 14 or 15, as the case requires.

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• (1) Subject to paragraph (4), the supplier shall claim any such tax credit by bringing it into account when he is accounting for CCL due from him for any accounting period.

• (2) Accordingly—

• (a) the requirements of regulation 5 (content of returns), regulation 6 (payment of CCL) and regulation 7 (CCL accounts) apply subject to paragraph (1); but