Project Approval
REGULATORY UPDATE – NOTIFICATION OF REQUIREMENT FOR ALL PROJECTS TO BE APPROVED BY ENTRUST BEFORE ANY LANDFILL COMMUNITY FUNDS EXPENDITURE
Under paragraph 34(1) of the Landfill Tax Regulations 1996 (Regulations) ENTRUST have the power to impose conditions on Environmental Bodies (EBs). In exercising our power under this paragraph, we have reviewed the following conditions that were previously imposed on all EBs:
• An EB must notify and register details of any project before the EB spends a contribution or enters into any contract/obligation to spend a contribution on a project; and
• An EB must not spend a contribution on a project until that project has been approved.
As part of our review process, we discussed the application of these conditions with HMRC and consider that the first condition is no longer required as it simply sets out the administrative process of seeking approval through the project registration process. This condition will therefore be revoked.
The second condition has been redrafted to make its application clearer:
• No qualifying contribution or any income derived from it may be spent on a project unless that project has first been approved by ENTRUST.
The removal of the old conditions their replacement with the new one came into effect on 01 January 2012. EBs must have had a project approved by ENTRUST prior to any LCF monies being spent on it and the project registration process still applies to any EBs wishing to seek approval of their projects. If the condition is not followed, EBs will be in breach of the condition and subsequently the Regulations, which may result in enforcement action being taken.
Accredited EBs have automatic approval of the projects that they register online.
If you have any questions regarding this change, please contact the Senior Registrar on 01926 488 300.