Aggregates Levy Calculator 2025/26 — Quarried Sand, Gravel & Rock Tax

The Aggregates Levy is an environmental tax charged on the commercial exploitation of sand, gravel, and rock quarried in the UK. It was introduced in 2002 to encourage recycled aggregates and reduce primary quarrying. The levy is paid by quarry operators but passed on in the price of aggregate to construction companies and builders.

The rate is £2.03 per tonne for 2025/26, increased from £2.00 per tonne in 2024/25. The rate was frozen at £2.00 from 2009 to 2024, then increased in the 2024 Autumn Budget as part of measures to encourage recycled aggregates. HMRC announces rates in the Budget.

Exemptions include: aggregate exported from the UK, aggregate extracted from an existing aggregate stockpile in certain circumstances, shale (generally), clay (ball clay and china clay), industrial minerals (coal, lignite, certain ores), rail ballast used for track maintenance, and aggregate used for exempt processes. The exemptions are detailed in the Finance Act 2001.

Any business that commercially exploits aggregate in the UK must register with HMRC for Aggregates Levy. This includes quarry operators, dredgers, and importers of aggregate from outside the UK. Registration must be done before the first exploitation of aggregate. Small producers under certain thresholds should check current HMRC guidance.

No. Recycled and reclaimed aggregate (such as recycled concrete, reclaimed tarmac, or reused road materials) is not subject to Aggregates Levy. This is a key environmental incentive — using recycled materials in construction avoids the levy. Demolition waste processed into secondary aggregate is also generally exempt.

For mixed loads of taxable and exempt aggregate, the levy applies only to the taxable portion. Operators must keep records of the proportion of each type. HMRC may audit these records. Separate weighing or reliable estimation methods must be used to determine taxable quantities.

VAT at 20% is charged on the total sale price, which includes the Aggregates Levy. The levy itself is part of the taxable supply value. VAT-registered businesses can reclaim the VAT as input tax, but the levy itself is not recoverable through VAT — it's a cost of the supply.

Aggregate imported into the UK from outside the UK is also subject to Aggregates Levy when first exploited commercially in the UK. The importer (or first UK commercial exploiter) is responsible for accounting for the levy. Aggregate coming from the Republic of Ireland is a special case with specific rules.

Aggregate used for sea defence, coastal protection, or flood protection schemes may qualify for a partial exemption under specific circumstances. Check the current HMRC Aggregates Levy guidance, as these exemptions are subject to conditions.

Marine-dredged aggregate from UK waters (rivers, estuaries, sea) is subject to Aggregates Levy when first exploited commercially. Marine dredging companies must register and account for the levy. This includes aggregate dredged for beach replenishment and offshore construction.

Scotland, Wales, and England all come under UK-wide Aggregates Levy (unlike landfill tax, which is devolved). There are no separate Scottish or Welsh aggregate taxes. The UK Aggregates Levy applies uniformly across Great Britain (Northern Ireland has EU state aid complications historically).

Levy-registered businesses must keep: weighbridge records (or reliable measurement of quantities), descriptions of aggregate type (taxable vs exempt), records of any claims for relief or credits, and sales/export records for 6 years. HMRC officers can inspect these records during visits to quarry sites.