Solid Fuel Carbon Tax (SFCT)

Taxable and tax-free solid fuel supplies

Taxable supplies

Taxable supplies include first supplies in the State of coal, peat briquettes, milled peat and other peat.

Coal and peat are defined in Section 77 of the Finance Act 2010 and is chargable per tonne of product. Coal also includes any other energy product in solid form within the meaning of Article 2.1 of the Energy Tax Directive 2003/96/EC.

Tax-free supplies

When solid fuel is first supplied for use as a raw material in the manufacture of a solid fuel product, SFCT is not chargeable provided:

  • the solid fuel product has characteristics that are distinct from the solid fuel from which it is produced
  • and
  • the supplier obtains a properly completed Declaration Form from the manufacturer in advance of making each supply.

The manufacturer must maintain adequate records of the receipt and use of such tax-free supplies including the following:

  • Details of the manufacturing process for each solid fuel product.
  • The effects of the manufacturing process on the characteristics of the solid fuel used to manufacture the solid fuel product.
  • A copy of the declaration provided to the supplier.

SFCT becomes due when the manufactured solid fuel product is itself first supplied in the State by the manufacturer. The manufacturer who makes the first supply is accountable and liable to pay the SFCT rate applying to the finished product.

Additional information is available in the SFCT Compliance Procedures Manual in the further guidance section.

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