Climate change levy
Produced in partnership with Angus Evers of Shoosmiths LLP
Climate change levy

The following Environment guidance note Produced in partnership with Angus Evers of Shoosmiths LLP provides comprehensive and up to date legal information covering:

  • Climate change levy
  • Brexit impact
  • What is the climate change levy?
  • Taxable supply
  • Taxable commodities
  • Carbon price support
  • Registration requirements
  • Cost of the climate change levy
  • Consequences of not paying the climate change levy
  • Tax supply or tax point
  • more

Brexit impact

As of exit day (31 January 2020) the UK is no longer an EU Member State. However, in accordance with the Withdrawal Agreement, the UK has entered an implementation period, during which it continues to be subject to EU law. This has an impact on this content. For further guidance, see: Brexit—impact on environmental law and Brexit Bulletin—key updates, research tips and resources.

What is the climate change levy?

The climate change levy (CCL) is a mandatory tax on UK business energy use, charged at the time of supply, known as taxable supplies.

It is administered by HMRC but collected by energy suppliers via energy bills.

Taxable supply

A taxable supply is the supply of a taxable commodity, including self-supply, by an energy supplier to a business consumer that is not excluded or exempt from the CCL.

What is a business consumer?

Business consumers include consumers in:

  1. industry

  2. commerce

  3. agriculture, and

  4. public administration

Definition of self-supply

Self-supply applies where a gas or electricity provider or a producer of other taxable commodities consumes its own supplies for its own business purposes (eg for heating and lighting administration buildings not directly connected with production), which it would otherwise supply to a third party.

However, energy is not liable to the CCL where a power producer uses energy that is necessary for,