Taxpayer successful in Landfill Tax Appeal: Nuttall & Anor v Revenue and Customs [2026] UKFTT 674 (TC)
A significant recent First-tier Tribunal decision in Nuttall v HMRC provides important guidance on the scope of landfill tax liability and the meaning of “disposal” under the modern landfill tax regime. The appeal was allowed in full, with the Tribunal rejecting HMRC’s attempt to impose more than £750,000 in landfill tax together with substantial compound interest.
The case concerned approximately 7,686 tonnes of refuse derived fuel (“RDF”) stored on land at North Killingholme pursuant to a commercial storage arrangement entered into in 2011. The material had originally been lawfully stored under an Environment Agency licence. However, HMRC later argued that a taxable “disposal” occurred in September 2017 when the licence-holder company, North Killingholme Recycling Limited (“NKRL”), was dissolved and the environmental licence automatically revoked.
HMRC’s case was effectively that the RDF had become abandoned on the site following the dissolution of NKRL and that this constituted a taxable disposal under section 40 of the Finance Act 1996. HMRC argued that the continued presence of the material without a valid permit amounted to a disposal for landfill tax purposes and sought to rely upon the expanded post-2018 landfill tax regime designed to target unauthorised waste sites.
The Tribunal rejected HMRC’s position.
Importantly, the Tribunal held that, on the facts of the case, the dissolution of NKRL and the associated revocation of the environmental licence did not cause the RDF to be “disposed” of within the meaning of the legislation.
The Tribunal accepted that the modern legislation no longer requires an express “intention to discard” in the way the original 1996 legislation once did. However, the Tribunal nevertheless held that intention remained a relevant factor in assessing whether a disposal had in fact occurred. At paragraph 75, the Tribunal stated:
“we consider that intention can be a relevant factor in a multi-factorial assessment of the facts to determine whether there has been a disposal.”
The Tribunal went on to undertake a detailed factual analysis of the arrangements surrounding the RDF and concluded that there had never been any intention on the part of Mr Nuttall, NKSL or NKRL permanently to abandon the material. Instead, the evidence showed sustained efforts over many years to secure its removal from the site.
Several findings were particularly important to the Tribunal’s reasoning.
First, the RDF had originally been brought to the site pursuant to a commercial storage arrangement rather than for permanent disposal.
Secondly, the Tribunal accepted that Mr Nuttall and the associated companies consistently sought removal of the material and cooperated with the Environment Agency throughout.
Thirdly, the Tribunal placed weight upon the fact that the RDF was continuously maintained safely on the site after the licence revocation, including re-baling work and pest control measures. The material was not simply abandoned and ignored.
Fourthly, the Tribunal accepted that there were genuine commercial incentives to remove the material because no rent was being paid for its storage and the lease obligations ultimately required clearance of the site.
The Tribunal ultimately concluded at paragraph 93:
“Viewing these facts in the round, we do not consider that the dissolution of NKRL and associated revocation of the Environment Agency licence caused the RDF to be ‘disposed’ on 28 September 2017.”
The decision is significant for landfill operators, waste businesses, environmental advisers and taxpayers involved in landfill tax disputes because it demonstrates that HMRC cannot simply assume that the continued presence of material at a site automatically constitutes a taxable disposal.
The judgment also illustrates the increasingly sophisticated and fact-sensitive nature of modern landfill tax litigation. These disputes frequently involve complex interactions between tax law, environmental permitting, commercial arrangements, waste regulation and evidential analysis.
Importantly, the Tribunal emphasised that the correct approach is to examine the facts “in the round”, including the parties’ rights, responsibilities, intentions and practical conduct in relation to the material.
The case is therefore likely to be of continuing relevance in disputes concerning:
landfill tax assessments,
alleged unauthorised waste sites,
temporary storage arrangements,
environmental permit revocations,
and HMRC allegations that material has been “abandoned” for landfill tax purposes.
For businesses facing substantial landfill tax assessments or HMRC investigations in the waste sector, the decision is also a reminder that HMRC’s analysis may be challenged successfully where the factual and commercial reality does not support the conclusions advanced by HMRC.