If you're an electricity producer or energy supplier, check if you should register, send returns and pay the levy. Also, find out how to change or cancel a registration.
Who should register for the levy
If you supply taxable energy commodities, use them yourself for your business or supply them to other areas of your business (self-supply) you must:
register with HMRC
fill in regular returns
include the charge on invoices (for energy supplies)
pay the levy to HMRC
As a supplier, you must charge the levy if your customer’s business is in any of the following sectors:
All supplies to domestic users, non-business users and charities are excluded from the levy. If you only make exempt or excluded supplies you do not need to register.
If you operate a combined heat and power station, you need to register for the levy.
Taxable energy commodities
There are 4 types of taxable commodities, they are:
liquified petroleum gas, including any other hydrocarbon gas in a liquified state
coal and lignite, including coke, semi-coke and petroleum coke
You must charge the levy when you:
supply these commodities to business consumers
use some of the commodities yourself
use a commodity to generate electricity
We have the power to direct that someone be treated as a utility for Climate Change Levy purposes. This can be done even though they do not hold a gas or electricity supply licence.
If a business tenant gets their supply of gas or electricity from their landlord, granting the landlord directed utility status would allow the tenant to benefit from any relief they were entitled to.
This direction only has effect for Climate Change Levy. It does not change any legal requirement to hold a supply licence.
When HMRC will make a direction
We will only make directions in 2 situations:
Where Climate Change Levy is not being charged on supplies although it should be.
Where a non-utility supplier has customers that would be entitled to reliefs that can only be made available by a utility.
In the second situation, we will only make a direction on the request of the person who wants to be treated as a utility.
We will only direct that someone be treated as a utility where:
- they are supplying gas or electricity to customers and making the direction allows those customers to get Climate Change Levy relief that they would not be able to claim, section 6.9 of Excise Notice CCL1/3 has more information
- there are genuine commercial or practical reasons why customers cannot purchase their gas or electricity direct from a licensed supplier
We do not backdate directions.
Responsibilities of energy consumer
All supplies to you from a licensed supplier of either gas or electricity for which you are treated as a utility will be free of this levy. You will need to tell your supplier that you are the subject of a utility direction from us. This may be done by sending them a copy of the direction we have issued.
How to get a utility direction
You must write to HMRC and explain:
- who you are
- what supplies you make and why you need a utility direction
An authorised person must sign your application, in the case of a limited company this should be one of the following:
- the director
- company secretary
- someone who has authority to act for and on behalf of the company
You cannot register until the direction is made.
If you no longer want to be a directed utility
You should write to HMRC stating why you no longer want to be a utility.
If we make a direction that you are no longer a utility for Climate Change Levy purposes, you will cease to be a utility from the date on which that direction is made or any other date specified in the direction.
You will have to cancel your registration for Climate Change Levy if you make no other taxable supplies.
When and how to register
You must register with HMRC within 30 days of the date you make, or intend to make, your first taxable supply or self-supply.
To register, you need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you register.
Use the online service to register.
If you cannot register online you can register using the postal form.
You’ll need to fill in the form on screen, print it off and post it to HMRC.
If you’ve not registered on time, HMRC could issue you with a penalty. Read Excise Notice CCL1/5: penalties and interest for more information.
You might need to fill in extra forms if your business is set up as either a:
The standard registration form should be filled in by the trustees or beneficiaries.
You’ll also need to fill in the:
Register as a corporate group
You can register your company and other individual companies as a group through one representative member.
Your group’s representative member must then account account for the levy as a sole company would, as well as:
all taxable fuel movements between members of the group
self-supplies made by group members
Register your group
To register as a group, you’ll need to fill in the:
normal Climate Change Levy registration form for a sole company
group member details form
Every member of your group is jointly and severally liable for any levy due from the representative member. This means your group’s members are responsible together, and individually responsible, for the group’s payments.
Control of your group
Your group must be controlled by one of the following:
a company within the group
an outside company
Register as a division
You can apply for divisional registration if it would cause your company difficulty to submit a single return.
All divisions of your company will have a separate registration number. You’ll then need to submit a separate return for each division. The levy will be applied to movements between divisions.
Each division must:
be an independent unit
have its own accounts
operate in a different location to other divisions
You’ll not pay the levy on movements of taxable fuel between divisions.
If any of your divisions use the taxable fuel, the levy will be due. The division using the fuel is responsible for the levy.
For each division you want to register, also fill in a separate divisional registration form.
You should also include a letter written by, or on behalf of, the corporate body explaining why you want to register each division separately.
If you’re a UK resident and you import taxable commodities and supply them to end-users, or you’re the end-user, you need to register for the levy.
You do not need to register if you import supplies and both:
do not use them yourself
only supply them to wholesalers or retailers (not end-users)
You need to get notifications from your customers that state they intend to supply the commodities to their own customers.
Businesses based outside the UK
If you’re not resident in the UK, and you’re not a utility, the person you supply should register.
Once you’ve registered
When we’ve processed your application, we’ll tell you your registration number on a registration certificate.
If you do not hear from us within 3 weeks of submitting your application, contact the helpline.
When you get your certificate, check that all the details are right. Tell us about any errors through the helpline.
The certificate will tell you when your returns are due and when you should pay the levy.
The levy is charged at different rates for each unit of energy and for each of the 4 groups of taxable commodity.
Change your registration details
Write to HMRC within 30 days if:
your business details change
you need to cancel your registration for Climate Change Levy
You could get a penalty if you don’t tell HMRC on time.
Records you must keep
You should keep business records for 6 years. They must be available for us to see whenever we need to.
Small businesses may be able to submit annual returns.
Guidance with a force of law
Find out about the force of law for this guidance.