These Regulations11 amend the existing rules about administering exemptions and other reliefs from climate change levy (CCL)12.

Regulations 5(g) to 5(k) enable consumers who under-estimate their entitlement to exemptions and other reliefs for a given period to enjoy the benefit of their tax credit earlier. This is because the tax credit no longer has to be assimilated into the consumer’s estimate for the exemptions and other reliefs in the subsequent period.

A business supplied with commodities on a non-taxable basis later determined to be taxable must register for CCL to pay the amount due13. Regulation 5(e) makes amendments that enable HM Revenue & Customs to exempt such a business from registration on the basis of a suitable written application and payment of the CCL due14. Regulation 2 provides for existing record-keeping requirements to apply to such a business.

The precise amount of exemption for the fuel burned by a combined heat and power station in producing electricity may not be known until the end of a calendar year15 although the supplier provisionally makes the exemption available during the year16. Regulation 5(m) makes amendments that require the station to reconcile separately the actual exemption with the amount made available. The reconciliation is linked to significant days in the station’s assessment cycle17, but otherwise operates under rules parallel to those that apply to businesses generally for other exemptions and reliefs18.

Certified19 electricity produced in combined heat and power stations may be supplied exempt from CCL20. Regulation 7(2) removes the certification requirements for stations that only supply the electricity directly to the user21. The remainder of regulation 7 makes technical changes to the manner in which certification proceeds22.

Regulations 4 and 5(b)(ii) make consequential amendments to assimilate the new CCL exemption for recycling processes23 within existing administrative arrangements24.

Regulation 8 only adds words of elucidation25 to better sign post the basket of provisions relating to eligibility of CCL tax representatives.

A full regulatory impact assessment has not been produced for this instrument as it has no impact on the costs of business, charities or voluntary bodies.