7 January 2020 by Joshua Doherty

Waste firms win appeal in landfill fluff case

Three waste companies have won an appeal against a ruling which stated that material deposited in landfill sites as ‘fluff’ was liable to landfill tax.

In the latest ruling in a long-running dispute over whether fluff is taxable if it is used for ‘engineering’ purposes, Upper Tribunal judges Mr Justice Fancourt and Judge Timothy Herrington handed down their ruling favour of Biffa, Devon Waste Management and two Veolia companies.

The case centres on whether ‘landfill fluff’ – which is made from residual waste and lines a cell – is taxable (pictured: Generic landfill site)

HMRC is now assessing whether to appeal the case in the Court of Appeal.

The decision was handed down on 2 January, after the case was heard at the Upper Tribunal Tax and Chancery Chamber.

Biffa was also successful in a separate and similar appeal on the issue which was heard at the same time, relating to a type of landfill fluff which it had manufactured.

Both cases relates to what is referred to as ‘fluff’, which generally consists of ‘soft’ black bag waste. This can be deposited at the base of where landfilled waste is buried, as well as up its sloping side and/or on top of the main body of landfilled waste.


The judges in the Upper Tribunal Tax and Chancery Chamber were ruling in an appeal over a decision made in May 2018 by Tribunal judge Kevin Poole.

At the time, Justice Pool said when dismissing an appeal against an earlier decision that it is clear that “all the material was destined for landfill in any event, in the main body of landfilled waste if not as fluff” (see letsrecycle.com story).


Upon appeal however Justice Fancourt and Judge Herrington dismissed this last week.

Her Majesty’s Revenue and Customs (HMRC) offices in Westminster

“In our view…if a site operator disposes of material at a landfill site, but in doing so intends to and does make use of its properties for his own purposes, including compliance with regulations, licenses, permits or any other requirements for the site, that use means that the operator does not make the disposal with the intention of discarding the material,” the ruling stated.

“That is so regardless of whether the material is recycled or sorted before being deposited on the landfill site, and even though the disposal is acknowledged to be ‘by way of landfill’”.

HMRC argued that the amounts that are being reclaimed constitute a large part of the tax that has been collected; and if the claims were ultimately upheld the environmental purpose of the tax would therefore be undermined because the cost of landfilling waste would be reduced and this would discourage recycling.

2008 ruling

The long-running issue dates back to 2008, when HMRC said it would not appeal against a ruling in which a court found in favour of Waste Recycling Group (WRG), which was later acquired by FCC Environment.

WRG had successfully argued that a landfill site operator, who had used various inert materials for building roads and for ‘daily cover’ on a landfill site, did not have the intention of discarding it as it had retained and used the material for its own purposes.

“HMRC is disappointed with the ruling from the Upper Tribunal and will consider the ruling carefully.”


HMRC then invited claims for repayment of landfill tax which fell within such examples. This is when various waste companies put forward claims relating to landfill fluff.

In mid-2009 HMRC decided that base and side fluff claims were in principle, well founded.

In December 2013, HMRC decided to stop repaying on base and side fluff, but said it would not seek to reclaim what it had already paid and issued a brief explaining this in 2014. Repayments are thought to be around £300 million (see letsrecycle.com story).

Next steps

In a statement given to letsrecycle.com, a spokesperson for HMRC said: “HMRC is disappointed with the ruling from the Upper Tribunal and will consider the ruling carefully.”

HMRC will now have to decide whether to appeal the latest ruling and it would need to convince the Court of Appeal to hear its case. If successful it could eventually end up in the Supreme Court of the United Kingdom, the UK’s highest court.


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