Frequently Asked Questions
The information given below is intended to assist you in understanding the Landfill Tax Credit Scheme and how it may be able to help you in gaining funding for your project. However, it is not exhaustive, should you wish to find you more about the Scheme please go to the ENTRUST web site for more information.
- What is the Landfill Tax Credit Scheme?
- Who is ENTRUST?
- What is an Environmental Body?
- Does my project qualify under the LTCS?
- How does the Landfill Tax Credit Scheme work?
- What is a third party contribution?
What is the Landfill Tax Credit Scheme?
The Landfill Tax Credit Scheme (LTCS) was introduced in the Landfill Tax Regulations in 1996. LTCS permits the up to 6% of the Landfill Tax collected by Landfill Operators to be voluntarily contributed to social and environmental projects complying with specific categories under the regulations. The name of the scheme has recently been changed to the Landfill Communities Fund by the government.
Who is ENTRUST?
ENTRUST is the regulator of the LTCS. It is a private non-profit making company, which is approved by HM Revenue and Customs. ENTRUST's responsibilities include enrolling Environmental Bodies (EB), registering projects and auditing and inspecting projects and EB's.
What is an Environmental Body?
An Environmental Body is a non-profit making organisation, which must be independent of local authority or landfill operator control and must be enrolled by ENTRUST. EB's can be a corporate body, a trust, a partnership or an unincorporated body. A Landfill Tax contribution can only be paid to an EB. Waste Management Research Limited is an EB.
Does my Project qualify under the LTCS?
There are six categories under which projects can be registered by ENTRUST. These are as follows: -
- A) Reclamation of land, whose use is prevented by a previous activity.
- B) Projects to reduce or prevent pollution of land, whose use is prevented by a previous activity.
- D) Provision and maintenance of public amenity (cycle routes etc); and delivery of biodiversity conservation for UK species habitats.
- E) Restoration and repair of buildings open to the public for religious worship or which are of historic or architectural interest.
- DA) Protection of the environment, and the conservation or promotion of biological diversity through:-
- i. the provision, conservation, restoration or enhancement of a natural habitat; or
- ii. the maintenance or recovery of a species in its natural habitat, on land or in water situated in the vicinity of a landfill site.
N.B. Objects C and CC were removed from the Landfill Tax Regulations on 1st April 2003.
How does the Landfill Tax Credit Scheme work?
There are two basic hurdles that must be overcome to get your project sponsored by the LTCS.
First you must get a Landfill Operator or an EB interested in your idea. This can be done by approaching the Landfill Operator directly, or via an EB who then passes your idea onto a Landfill Operator.
As general rule you should provide the following information: -
- Describe your project carefully and in detail;
- Make sure you include a breakdown of the costs;
- Make sure you give an indication of timescales; and
- Indicate whether a third party contribution is available.
If a Landfill Operator likes your idea and is willing to fund it, they will ask an EB to get the project registered by ENTRUST. Once ENTRUST registers your project it is then ready to get underway.
What is a third party contribution?
For contributions worth up to 6% of the Landfill Operator's landfill tax, they can claim a tax credit of 90% of the money given. A third party may donate an amount equivalent to the 10% to the LO. This is known as a Third Party Contribution. (This is also known as a Contributing Third Party or a Third Party Funder).
Third parties can be private companies, public sector organisations, charities, voluntary bodies or individuals.
A third party must be independent of EB's. It cannot be another environmental body, the agent of an EB or an organisation corporately associated with an EB.
Third parties' contributions can act as levers. They help to make things happen. A third party contribution might make the difference between getting a project done or not.