- Summary
- Who the operator of the site is
- Adjustment of contracts
- Bankruptcy, incapacity or death
- Unregistered supply
Summary
You will be liable to pay Scottish Aggregates Tax if you are responsible for the commercial exploitation of aggregate as part of furtherance of a business carried on by you. The phrase ‘furtherance of business’ includes public sector and governmental organisations, charities and not for profit organisations.
The taxpayer will typically be the person or business responsible for using or supplying the aggregate as part of a business activity. This can vary depending on how and where the aggregate is exploited.
| When commercial exploitation occurs through… | The person(s) responsible |
| removal from the originating site or a connected site | the operator of that site |
| removal from a site to which aggregate had been removed to have an exempt process applied to it, but that process was not applied |
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| an agreement to supply to a person when the aggregate is on its originating site or a connected site |
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| an agreement to supply to a person when the aggregate isn’t on its originating site or a connected site | the person agreeing to supply it |
| use for construction purposes when the aggregate is on its originating site or a connected site |
|
| use for construction purposes when the aggregate isn’t on its originating site or a connected site | the person using it for construction purposes |
| mixing with anything other than water at the originating site or a connected site |
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| mixing with anything other than water at a premises not on the originating site or a connected site |
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Legally, more than one person can be liable to Scottish Aggregates Tax, in which case their liabilities will be joint and several. In practice, however, only one party should register and account for the levy. In the first instance this should be the operator of the site but if you are unsure about who is liable for any obligation then you can contact us by [link].
Who the operator of the site is
The operator of a site is:
- the person who occupies the site
- a person other than the occupier if they exercise control over aggregate on that site
Exercising control over aggregate on a site includes doing any of the following:
- winning aggregate from land at that site
- carrying out any excepted process at that site
- storing aggregate at that site
Adjustment of contracts
Where you have entered into a contract to supply a quantity of aggregate to a customer and, after entering into that contract the Scottish Aggregates Tax chargeable changes (for example, if the rate of tax changes) then you may be able to adjust the contract to reflect the additional tax due.
All of the following conditions must apply before you can make the adjustment:
- you have made an agreement to supply a quantity of taxable aggregate to a person
- a payment is due under that agreement
- there has been a change to the tax chargeable in relation to the aggregate referred to in that agreement
If the above conditions are met then you may adjust the amount of the payment to reflect the change in the amount of tax chargeable, unless the agreement provides otherwise. The adjustment will allow the burden of the additional tax to be place on the customer rather than the supplier.
This applies whether the change in tax is due to the amount of tax chargeable, or due to a change to or from no tax being chargeable.
Bankruptcy, incapacity or death
If someone who should be registered for Scottish Aggregates Tax becomes bankrupt, incapacitated or dies, Revenue Scotland can treat any person carrying on the business as a registrable person. This applies from the date the bankruptcy, incapacity or death occurs.
Any person carrying on the business must inform Revenue Scotland within 30 days of taking over the business. You must also inform us of the date of the bankruptcy order or of the nature of the incapacity or of the death and the date on which it began or occurred. Notifications to Revenue Scotland are made through a message on the SETS system.
Revenue Scotland must stop treating you as a registrable person if:
- the registration of the registrable person is cancelled
- the bankruptcy is discharged
- you cease carrying on the business of the registrable person
Unregistered supply
If you purchase aggregate from a person who is not registered for Scottish Aggregates Tax but should be then you may become jointly and severally liable for the Scottish Aggregates Tax that should have been paid at point of supply.
You should ensure that the supplier of your aggregate is registered for Scottish Aggregates Tax and, if there is any doubt, you should retain evidence of how you concluded the registrable status of your supplier.
If you are unsure whether the supplier is registered for Scottish Aggregates Tax, you can look up the published registered list. If you have any further questions about the registration status of a supplier, then you can contact us by [ link ].
Additionally, if you are part of a supply chain in which the aggregate has been purchased from an unregistered supplier then you may still be held jointly and severally liable for the Scottish Aggregates Tax that should have been paid at point of supply.
For example, a construction firm requires a large amount of aggregate to aid in the construction of a large infrastructure project, and they agree a procurement contract with a sub-contractor who initially purchases 30,000 tonnes of aggregate from a registered supplier at £12.00 per tonne. This price includes £2.00 per tonne Scottish Aggregates Tax (for illustrative purposes only). Halfway through the project the sub-contractor changes supplier as the new supplier is offering the same type of aggregate at £10.00 per tonne. 40,000 tonnes of aggregate is purchased by the sub-contractor. The new supplier is not registered for Scottish Aggregates Tax, but they should be as they are supplying primary aggregate. £80,000 (40,000 x £2.00) Scottish Aggregates should have been paid by the second supplier, but this has not been done as they are not registered. All three parties (the unregistered supplier, the sub-contractor and the construction firm) will now be jointly and severally liable for the £80,000 due. Revenue Scotland may pursue any and all parties for the monies due.
If a chain of supply involves a number of different contracts all parties in the supply chain may still be jointly and severally liable.
For example, a public body is undertaking a large infrastructure project and has agreed a procurement contract (Contract A) with a sub-contractor. The sub-contractor has sourced the aggregate under a separate contract (Contract B) with an unregistered supplier. Even though the supply chain involves two separate contracts (Contracts A and B), all three parties (the unregistered supplier, the sub-contractor and the public body) may still be held jointly and severally liable for any Scottish Aggregates Tax that should have been paid at point of supply. Revenue Scotland may pursue any and all parties for the monies due.