You must keep and provide sufficient evidence to substantiate applying the lower rate of tax to any particular disposal of waste. If sufficient evidence cannot be provided to demonstrate how the waste qualifies for the lower rate, the standard rate of tax will be payable.
This includes obtaining (and then keeping and providing when required) sufficient evidence to substantiate that the lower rate of tax should apply after following the guidance outlined in SLfT2006 (for waste disposals wholly consisting of qualifying material apart from a small amount of non-qualifying material). For example, you will need to obtain (and then keep and provide when required) records relating to any Loss On Ignition (‘LOI’) test that is required where the waste material consists of qualifying fines apart from a small amount of non-qualifying material.
The only determining factor as to whether waste is qualifying material chargeable at the lower rate of SLfT is whether it is listed in and complies with the criteria contained within The Scottish Landfill Tax (Qualifying Material) Order 2016 (the material listed in the Order reflect criteria that the Scottish Ministers have set in relation to determining what can be listed as qualifying material – see SLfT2004).
Whether or not waste is considered to be inert for environmental protection purposes is not relevant to matters of tax liability. Equally, the fact that waste is listed in the Order does not mean that the waste is inert for environmental protection purposes.
To qualify for the lower rate, the waste transfer note (which is required to accompany all movements of waste) must accurately record the composition of the load of waste, setting out specifically which qualifying materials are contained in the load so that it can be related to the terms used in the Order. The waste transfer note must accurately describe the waste for standard rate too.
The waste transfer note may cover individual loads or it may be a 'season ticket' covering a number of loads sent for disposal to a landfill site over a period of time.
If you operate an in-house landfill site and have applied the lower rate to waste which you have disposed of in that site, you will need to provide evidence (such as production records and testing analysis) to show that the waste qualifies for that rate.
The requirements relating to the waste transfer note described above are for tax purposes. They in no way override or affect any obligations in relation to the waste transfer note in environmental protection law, including the requirement to define the waste source by reference to the European Waste Catalogue codes.
Some waste streams may be sufficiently complex in nature that analysis may be required to demonstrate that they qualify for the lower rate of tax. For example, trommel fines (the residual materials left after processing activities are undertaken at waste transfer stations, waste recycling/treatment facilities or material recovery facilities) may need to be subjected to a loss on ignition test to demonstrate that the fines are sufficiently non-polluting to be taxed at the lower rate.