Report Climate Change Levy subsidies to HMRC

Why you need to report

HMRC collects information for transparency purposes. This is to promote accountability from UK businesses receiving Climate Change Levy reliefs, either as participants in Climate Change Agreements, or exempt open access rail operators where the annual tax subsidy award is above the threshold.

You can search for UK subsidies awarded by UK public authorities.

What are the thresholds for reporting subsidies

The threshold for reporting your annual Climate Change Levy subsidy award is £100,000 or more.

You’ll need to report on subsidies of £100,000, or more, if you are either:

• in a Climate Change Agreement and receive a relief from Climate Change Levy
• are exempt from Climate change Levy because you are an open access rail service operator

If you’re registered in Northern Ireland

If you’re registered in Northern Ireland and trading in goods or the wholesale electricity market, you’ll need to report your annual Climate Change Agreement subsidy award, if it is 100,000 euros, or more. Find more information on which businesses are in scope.

For calendar year 2023 (1 January to 31 December) the threshold for reporting subsidy award if you’re in a Climate Change Agreement is £86,994, or more.

You will need to check the official HMRC foreign currency exchange average rates — using the UK Integrated Online Tariff for the calendar year being reported. The financial threshold may vary slightly from year to year depending on the exchange rate.

What you need to report

You’ll need to confirm if you’re either:

• reporting as a participant in a Climate Change Agreement
• an operator under the open access rail service

You’ll need to tell us:

• your company name and address
• your company VAT number
• the number of employees in your business
• if your business is incorporated and registered in Northern Ireland
• the type of business activity such as goods or services where the subsidy is mainly used and information about the sector
• the region which has mostly benefitted from the subsidy
• the amount of subsidy your business has received for the required reporting period — round down to the nearest pound

Work out your annual tax subsidy award

Climate Change Agreements

The subsidy award amount, if you’re in a Climate Change Agreement is the difference between:

• the amount of Climate Change Levy paid at the reduced rate
• the amount of Climate Change Levy that would have been paid at the main rate on your taxable supplies — like electricity, natural gas, liquefied petroleum gas and any other taxable supplies (solid fuels)

Operators of open access rail services

To work out the subsidy award, you’ll need to:

1. Work out the amount of electricity used at the main rate of Climate Change Levy from 1 January to 31 December.
2. Multiply this by the main rate for the period you’re reporting.
3. If you use a mix of fuels, report electricity usage only.

Check the latest Climate Change Levy rates to make sure the right rate is applied for the year that’s being reported.

For example, if you are reporting subsidies for the 2023 calendar year period, remember that in April 2023 there were changes to some Climate Change Levy rates. Make sure you use the correct rates for each month to provide a total of the subsidies received for that reporting period.

How to report

If you’re a representative of the company — you’ll need the Government Gateway user ID and password. If you do not have a user ID, you can create one the first time you sign in.

If you’re an agent — you’ll need the Government Gateway user ID and password you used when you registered for the Agent Services Account. If you do not have an Agent Services Account, you will be asked to enter the Agent details manually.

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More information 

If you have any questions about reporting Climate Change Levy subsidies to HMRC, email: energy.taxes@hmrc.gov.uk.