All EBs will receive a notification of the change to the conditions imposed on Environmental Bodies (EBs) by ENTRUST under paragraph 34(1) of the Landfill Tax Regulations 1996 (Regulations).
In exercising our power under this paragraph, we have reviewed the following conditions that are currently 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 have discussed the application of these conditions with HMRC and on reflection 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.
We will remove the old conditions and replace them with the new one with effect from 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.