UK CBAM
UK Carbon Border Adjustment Mechanism (Finance Act 2026 and CBAM regulations)
Topic : Climate · Level : National
Today
Enacted (Finance Act 2026, Royal Assent 18 Mar 2026); 5 SIs made Jul-Sep 2026; applies to imports from 1 Jan 2027, no transition.
Summary
UK carbon tax on imports of steel, aluminium, cement, fertilisers and hydrogen from 1 January 2027. Importers above GBP 50,000 a year register with HMRC, calculate embedded emissions and pay. First return is due 31 May 2028.
Who is concerned
- Turnover
- >GBP 50,000 of CBAM goods in 12 months
- Employees
- non précisé
- Listed company
- cotées et non cotées
- Sectors
- Iron and steel
- Aluminium
- Cement
- Fertilisers and hydrogen
- Triggering activities
- Importing CBAM goods into the UK
- Above GBP 50,000 value threshold
- Extraterritorial reach
- Yes
Tax on embedded emissions of imports; carbon price paid in the origin country can be deducted.
- Examples
- UK distributor importing Chinese steel products
- UK builder importing aluminium profiles
What the law requires
- Register with HMRC once above the GBP 50,000 threshold
- Calculate embedded emissions per tonne of imported goods (actual or default)
- File returns and pay the CBAM liability (quarterly from 2028)
Penalties
Late registration: failure-to-notify penalty (FA 2008 Sch. 41, % of tax at stake). Late return, payment, inaccuracy: FA 2026 Sch. 17. Fraud offences.
What this changes for a supplier in China
Chinese steel and aluminium exporters to the UK need verified embedded-emissions data to avoid higher default values; a second CBAM after the EU one.
Expected evidence
- Installation embedded emissions per product
- Production route and precursors
- Carbon price paid in China (if any)
Tiers : Tier 1-2