UK Aggregates Levy and Scottish Aggregates Tax 2026/27

From 1 April 2026, Scotland replaced the UK Aggregates Levy in Scotland with Scottish Aggregates Tax, administered by Revenue Scotland. The change matters to quarries, construction suppliers and businesses that move rock, sand or gravel across the Scottish border.

The result is not simply “Scotland has a new tax”. Depending on where the aggregate is commercially exploited and where it moves, a business may need to register with Revenue Scotland, remain registered for HMRC Aggregates Levy, account for both taxes on different parts of a movement, and claim cross-border relief so the same quantity is not taxed twice.

What changed on 1 April 2026?

Before devolution, the UK Aggregates Levy framework applied across the relevant UK territory. From 1 April 2026, the Scottish Government’s Scottish Aggregates Tax applies to aggregate commercially exploited in Scotland, while HMRC continues to administer Aggregates Levy for the parts of the UK within its scope.

HMRC’s guidance also changes the commercial-exploitation rules. Aggregate can continue to be exploited for Aggregates Levy when it is removed from its originating or connected site, used for construction, mixed outside the permitted exceptions, or supplied to another person. From 1 April 2026, the aggregate must generally be in England, Wales or Northern Ireland when the relevant event occurs. Separate rules apply when aggregate is moved from a Scottish site to another part of Great Britain.

This table is a routing aid. The material, site, process and movement still determine the precise liability.

Who is affected?

HMRC says the changes affect businesses registered for Aggregates Levy that either commercially exploit aggregate in Scotland or move or supply aggregate to a customer in Scotland from England, Wales, Northern Ireland or relevant waters.

The business should map the originating site, any connected site, any exempt process, the delivery or collection point and the territory where the relevant exploitation happens. A customer collection does not remove the supplier’s responsibility to understand the movement. If the customer takes aggregate across the Scottish border, the seller needs an audit trail showing what was supplied and where it went.

Registration and deregistration

If a business commercially exploits aggregate in Scotland from 1 April 2026, it needs to register for Scottish Aggregates Tax with Revenue Scotland and account for the tax there. A business that only has Scottish sites and does not move aggregate to England, Wales or Northern Ireland may no longer commercially exploit aggregate for HMRC Aggregates Levy and may need to deregister from HMRC.

However, a Scottish operator that moves aggregate to England, Wales or Northern Ireland may need to remain registered for Aggregates Levy for the relevant sites and movements. Deregistration should therefore follow a site-by-site review, not a simple assumption that Scottish activity has moved entirely to Revenue Scotland.

When contacting HMRC to deregister, the business should provide its name, Aggregates Levy reference, reason for deregistration and effective date, signed by an authorised person. Keep the final return and payment records.

Cross-border relief when supplying Scotland

If aggregate is supplied to Scotland from England, Wales or Northern Ireland, the supplier can claim relief from Aggregates Levy on the qualifying amount. The business must first account for the levy in the normal way, report the tonnage on its Aggregates Levy return, and use the cross-border relief field for the tonnage sent to Scotland.

From 1 April 2026, HMRC’s return includes a separate box for tonnes moved to Scotland. Relief cannot be claimed without accounting for the levy on that aggregate and holding supporting evidence. Useful records can include:

• the customer’s order and sales contract;
• correspondence confirming the destination;
• an invoice showing the aggregate is moving to Scotland;
• a delivery note or arrival evidence; and
• a signed customer declaration where the customer collects the aggregate.

For customer collection, link the declaration to the date, product and quantity. A generic statement that the customer “usually collects in Scotland” is weaker than a transaction-level audit trail.

Aggregate moving from Scotland to England, Wales or Northern Ireland

The Scottish site operator must declare and pay Aggregates Levy on aggregate moved from Scotland to England, Wales or Northern Ireland where the HMRC rules treat it as commercially exploited. The same quantity can also be subject to Scottish Aggregates Tax, but the Scottish tax return provides the relevant tax-credit mechanism so the levy is not paid twice on the same aggregate.

Businesses with cross-border flows need reconciled tonnage records for both returns. Do not assume that a single invoice, a transport document or a customer’s VAT treatment answers both aggregates-tax questions.

Builders’ merchants and middlemen

HMRC describes a specific middleman exemption for parts of the supply chain, such as builders’ merchants. A middleman that buys aggregate from a quarry and resells it from its premises may not have the same obligations as the quarry operator for aggregate supplied across the border.

The result can differ where the middleman arranges for the quarry to deliver directly to a customer across the border. In that situation, both the middleman and quarry operator can have responsibilities, with only one party needing to account for and pay the taxes. Agree who will handle the obligation and retain evidence rather than leaving the issue implicit in the sales contract.

Correcting mistakes

If a business incorrectly pays HMRC instead of Revenue Scotland, HMRC says it should contact the Aggregates Levy team in writing with its business details, repayment amount, explanation and bank details. Relief claims for Aggregates Levy already paid must be checked against the applicable four-year time limit.

An error in a return, a missing cross-border-relief claim and an incorrect registration are different problems. Correct the relevant return and retain the calculations, movement evidence and correspondence. Use Revenue Scotland’s current guidance for Scottish Aggregates Tax corrections and HMRC’s current guidance for Aggregates Levy returns.

A practical cross-border checklist

Evidence file for cross-border aggregate movements

Keep one movement-level record showing the material, quantity, site of commercial exploitation, processing, customer, destination, delivery or collection date and the tax authority to which the transaction was reported. Link each entry to the invoice, contract, transport or arrival evidence and any customer declaration. Do not rely on a destination postcode alone when the customer collects the material, and do not use a generic annual declaration where the authority guidance expects transaction-level support.

Reconcile the tonnage in the HMRC Aggregates Levy return, Revenue Scotland return, stock ledger and sales ledger. If a movement is exempt, relieved or outside the charge, record the precise reason and retain the evidence. A cross-border relief claim should be separately identifiable from the underlying Scottish Aggregates Tax entry so that the same quantity is not accidentally omitted from one return or claimed twice.

Agree responsibility in the supply contract

The business that extracts or commercially exploits the material may not be the same business that invoices the customer, arranges transport or operates the final delivery site. Before a cross-border sale, identify each party’s role and state who will register, classify the material, retain destination evidence, submit the relevant return and correct an error. A contract that only says “taxes are the buyer’s responsibility” may not override the statutory position or explain which party must hold the records.

For direct deliveries, retain the order, vehicle or haulier record, delivery address, proof of arrival and customer confirmation where required. For customer collections, record the collection date, vehicle or carrier, quantity and declaration. If material is processed, screened, mixed or moved between sites, keep the input and output quantities and explain how the tax classification was preserved or changed. These records are also useful for reconciling stock losses and identifying whether a movement was within duty suspension or released for consumption.

Review the first post-devolution return

For the first return covering activity after 1 April 2026, perform a separate review of every Scottish site and every movement to the rest of Great Britain or Northern Ireland. Confirm that the correct authority, registration, rate, relief and payment reference were used. Compare the return with the underlying tonnage rather than relying on the invoice total, because one invoice can include taxable aggregate, exempt material, transport and processing services. Keep a signed review note explaining exceptions and unresolved questions.

If the business discovers that the wrong authority was paid, do not make an equal and opposite entry in the next period without contacting the relevant authority. Prepare a correction schedule showing the quantity, tax, period, payment reference and requested remedy. Where a credit or relief is claimed, link it to the original payment and preserve the four-year or other applicable deadline evidence. A clean correction trail is safer than silently moving a quantity between the HMRC and Revenue Scotland ledgers.

Frequently Asked Questions

For the operative rules, read HMRC’s Aggregates Levy devolution guidance and Revenue Scotland’s Scottish Aggregates Tax guidance.

Official sources

• HMRC: Aggregates Levy devolution
• HMRC: Revenue and Customs Brief 2 (2026)
• Revenue Scotland: Scottish Aggregates Tax
• HMRC: Check when Aggregates Levy applies