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HMRC internal manual

Air Passenger Duty Risk Based Control

HM Revenue & Customs
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General: Outline of the regime and contribution to the revenue

Outline of the regime

Air Passenger Duty was introduced in the Finance Act 1994 and came into effect on 1November 1994. It is a duty of excise levied on the carriage, from a UK airport, of chargeable passengers on chargeable aircraft.

Airlines are required to register on Form APD1 within 7 days of a chargeable flight taking place. Failure to register, or to provide subsequent returns and payments where due, attract financial penalties.

From 1 February 2007, there are four rates of Air Passenger Duty:

Standard rates of £20 for destinations in the EEA and £80 for other destinations and reduced rates of £10 for destinations within the EEA and £40 for other destinations where the passenger is carried in the lowest class of travel on any flight.

A number of exemptions are provided for subject to maintenance of a full audit trail including for non passengers (crew etc), visiting forces, infants, transit and connecting passengers, pleasure flights and, since 1.4.01, flights from the Scottish Highlands and Islands.

Liability is determined by examination of ticket counterfoils or by means of special accounting schemes based on historical or sample data.

Contribution to the revenue

In the year 2007/2008 Air Passenger Duty amounted to approximately £2,000,000,000(£2bn).