Businesses warned over looming green tax deadline

19 August 2010

Leicestershire’s biggest businesses are being warned that they have just weeks to register for a new green tax and avoid paying thousands of pounds in extra costs.

Companies from the city and county that are eligible for the upcoming government legislation, the Carbon Reduction Commitment (CRC), have only weeks to prepare and register for the scheme.

Philip Rogers, tax partner at Cooper Parry Leicester, in the Business Quarter, said those affected cannot afford to leave registration until the last minute – or potentially face costs of nearly £50,000.

He said: “Just like the tax returns every year, businesses have a tendency to leave things until the last minute because they are so bogged down in the day-to-day running of the business.

“With many directors of businesses being on annual leave during the summer months, it may have escaped the attention of senior management. Unless they act now, it could end up costing thousands of pounds in unnecessary costs.

“Many may think that that they have plenty of time before the September 30 deadline but they need to act now, or otherwise risk significant fines. With the economic pressures of today, it is simply not worthwhile leaving everything to the last minute and incurring unnecessary expense.

The CRC Efficiency Scheme was launched in April 2010 as a mandatory system designed to help 5,000 large public and private sector organisations to cut their carbon emissions.

It will affect every business across the UK who spend about £500,000 on their energy bills every year.  Under the CRC those companies involved in the scheme have to buy carbon allowances for the amount of energy they consume.

Those affected must register with the Environment Agency, who is managing the legislation by September 30. Any business that misses the deadline faces an initial £5,000 fine and a daily charge of £500 until registered up to a maximum of £45,000

Research by Cooper Parry has shown over 100 companies in the city and county will be part of the compulsory carbon trading scheme including businesses such as Santander, Leicester City Council and crisp manufacturer Walkers.

Climate change minister Greg Barker recently revealed that only 1,229 of expected 4,000 companies have registered so far.