The Soft Drinks Industry Levy Regulations 2018

PART 6 Tax credits

Tax credits

15.—(1) A liable person is entitled to a tax credit if, after a charge to soft drinks industry levy has arisen in relation to chargeable soft drinks, any of cases 1 to 3 applies to those drinks.

(2) Case 1 applies where the liable person or another person exports the chargeable soft drinks from the United Kingdom.

(3) Case 2 applies where the liable person reasonably expects that another person will export the chargeable soft drinks from the United Kingdom.

(4) Case 3 applies where the chargeable soft drinks are lost or destroyed by virtue of the chargeable soft drinks being destroyed, disposed of as waste, reprocessed or spilled and incapable of further use.

(5) A liable person must make a claim for the tax credit.

(6) The tax credit is the amount (“the credit amount”) equal to the amount of soft drinks industry levy charge which applies to the chargeable soft drinks at the time of the chargeable event which occurs in relation to them.

(7) In respect of case 1, a claim for tax credit may be made in the return for an accounting period in which the liable person has sufficient evidence that the chargeable soft drinks have been exported.

(8) In respect of case 2, a claim for tax credit must meet the requirements in regulation 16.

(9) In respect of case 3, a claim for tax credit may be made in the return for an accounting period in which the liable person has sufficient evidence that the chargeable soft drinks are lost or destroyed.

(10) A claim for tax credit must—

(a) show separately the total of the credit amounts for—

(i) cases 1 and 2; and

(ii) case 3; and

(b) identify how much of each total is in respect of soft drinks industry levy charged at the rate provided by section 36(1)(a) and how much at the rate provided by section 36(1)(b).

(11) No claim may be made for a tax credit in respect of chargeable soft drinks more than two years after the date on which the chargeable event arose in respect of those drinks.

(12) In cases 1 and 2, an export of chargeable soft drink includes where the chargeable soft drinks are made available to be sold or provided free of charge by a person in the course of that person carrying on the business of transporting passengers between the United Kingdom and a place outside of the United Kingdom.

Case 2 – requirements

16.—(1) The claim for tax credit in respect of case 2 may be made in the return for an accounting period (“AP”) in which the liable person holds a reasonable expectation that the chargeable soft drinks in respect of which the levy has arisen are to be exported.

(2) The amount of the tax credit is a reasonable estimate of the amount (“the estimated amount”) to be exported in AP or the following accounting period (“AP+1”) or both.

(3) Paragraph (4) applies if by the end of AP+1 the liable person does not have sufficient evidence to show that the estimated amount has been exported.

(4) Where this paragraph applies, so much of the tax credit claimed in AP in respect of the estimated amount for which the liable person does not have sufficient evidence of export must be added back in the return for AP+1.

Sufficient evidence

17.—(1) In regulations 15 and 16, “sufficient evidence” means the prescribed evidence showing that the case applicable to the chargeable soft drinks has been met.

(2) The Commissioners must prescribe what amounts to sufficient evidence in each case.

(3) The matters which may be prescribed include—

(a) in respect of cases 1 and 2, evidence of export which applies for the purposes of excise, a duty or value added tax or which would apply were the chargeable soft drinks subject to those matters; and

(b) in respect of case 3, any of the matters in respect of which records are required to be kept under regulation 26.

Records in relation to tax credits

18.—(1) A liable person who makes a claim for a tax credit must keep a record of the following in respect of the claim.

(2) The volume (in litres) of chargeable soft drinks to which the claim relates which are within section 26(1)(a) and, in respect of that volume, how much—

(a) meets the higher sugar threshold in section 36(2); and

(b) does not meet the higher sugar threshold in section 36(2).

(3) The volume (in litres) of prepared drink to which the claim relates that would result from chargeable soft drinks within section 26(1)(b) and, in respect of that volume, how much—

(a) meets the higher sugar threshold in section 36(2); and

(b) does not meet the higher sugar threshold in section 36(2).

(4) In respect of chargeable soft drinks within paragraphs (2) and (3)—

(a) the total amount of the tax credit claimed; and

(b) how much of the total is in respect of soft drinks industry levy charged at the rate provided by section 36(1)(a) and how much at the rate provided by section 36(1)(b).