When does the UK CBAM start?

On 1 January 2027. It applies to aluminium, cement, fertiliser, hydrogen, and iron and steel goods imported into the UK on or after that date, across the whole UK including Northern Ireland.

Who pays the UK CBAM?

The importer: the business in whose name, or on whose behalf, the customs declaration is made. A UK business that buys steel or aluminium from a UK stockholder is not the importer, although the stockholder may pass the cost on in its prices.

Is there a threshold for small importers?

Yes. You only need to register if the value of CBAM goods you import reaches £50,000, either over the last 12 months or expected over the next 30 days. In the first year you only count imports from 1 January 2027.

When is the first UK CBAM return due?

The first accounting period is the whole of 2027. Registration for that year is due by 31 January 2028, and the first return and payment by 31 May 2028. From 2028, returns move to quarterly.

Does the UK CBAM affect UK businesses that export to the EU?

Not directly; that is the EU's own CBAM, under which EU importers owe a charge on these goods imported since 1 January 2026. UK exporters of steel, aluminium, cement or fertiliser are being asked by EU customers for emissions data per tonne. The UK and EU are negotiating to link their emissions trading schemes, which could lead to mutual exemptions, but no agreement has been concluded.

Is CBAM the same as Scope 3 reporting?

No. CBAM is a tax on the direct emissions of specific imported goods, worked out per tonne. Scope 3 is how you account for the emissions in everything you buy. A supplier's CBAM data can make your Scope 3 figure for those materials more accurate, but the two are separate.

UK CBAM starts 1 January 2027: what your customers will ask you

The UK Carbon Border Adjustment Mechanism (CBAM) starts on 1 January 2027 and taxes the emissions in imported aluminium, cement, fertiliser, hydrogen, and iron and steel. The importer pays, and only once its CBAM imports reach £50,000. Most small businesses won't register, but those that buy or sell these materials will be asked for emissions per tonne, and costs may rise.

Updated 7 October 2026 by the Carbon Recycling team. Figures use the official UK government conversion factors and are checked against the current gov.uk guidance.

CBAM in one paragraph

The UK charges its own heavy industry for carbon through the UK Emissions Trading Scheme. CBAM puts a matching charge on some of the same goods when they are made abroad and imported, so overseas producers don't have a price advantage just because their emissions aren't priced. It's set out in the Finance Act 2026 and is run by HMRC as a tax, not as a reporting scheme.

Which goods are covered

Five sectors: aluminium, cement, fertiliser, hydrogen, and iron and steel. Within those, only goods with the commodity codes listed by the government are in scope, and some are excluded, such as aluminium and steel scrap. If you import, your customs broker can tell you whether your commodity codes are on the list. Goods that originate in the UK are outside CBAM.

Who has to register

The importer is liable: the business in whose name the customs declaration is made, or on whose behalf it is made. You need to register with HMRC when the value of your CBAM imports reaches £50,000 on either test:

Looking forward: on any day, you expect CBAM imports in the next 30 days to reach £50,000.
Looking back: on the first day of each month, CBAM imports over the previous 12 months reached £50,000. In 2027 you only look back to 1 January 2027.

The value is the customs value, the same figure used for import duty.

The key dates

Date	What happens
1 January 2027	CBAM applies to goods imported from this date. Start keeping records.
31 January 2028	Deadline to register for anyone who became liable during 2027
31 May 2028	First return and payment, covering all of 2027
From 1 January 2028	Quarterly returns. The first, for January to March 2028, is due by 31 July 2028.

Records must be kept for six years after the end of the accounting period.

How the charge is worked out

The charge is based on the direct emissions embodied in the goods, in tonnes of CO2e per tonne of product, multiplied by the weight imported and the CBAM rate. Any carbon price already paid abroad under a qualifying scheme can be deducted. Importers have two ways to get the emissions figure:

Actual data from the overseas producer, verified by an accredited verifier. This is usually lower than the default, but the producer has to measure it and pay for verification.
Default values set by the government, one per CBAM good, to be published before CBAM starts. These need no input from the supplier.

What your customers will ask you

Most small businesses meet CBAM through someone else's paperwork. Which questions you get depends on where you sit:

You are	What happens
A UK business importing steel, aluminium, cement or fertiliser yourself	You may need to register if you pass £50,000. Ask your overseas suppliers now whether they can provide verified emissions per tonne, or plan to use default values.
A UK business buying these materials from a UK stockholder or merchant	You don't register. Expect price changes from 2027, and possibly a CBAM surcharge line on quotes.
A UK producer exporting these goods to the EU	You don't register in the EU, but EU importers owe the EU CBAM on imports since January 2026 and will ask you for emissions per tonne, ideally verified.
A UK producer selling these goods within the UK	Not covered by the UK CBAM. Customers may still ask for product emissions to compare you with importers.

If a customer sends a CBAM data request and you aren't a producer of CBAM goods, say so plainly; it is a common case of a questionnaire going to every supplier at once. Our guide to what large customers can and can't ask of small suppliers covers how to reply.

The UK and EU link

The UK and the EU are negotiating to link their emissions trading schemes. A link could lead to goods moving between them being exempt from each other's CBAM, but the European Commission has said it will not exempt UK goods until the link is in place, and no agreement has been concluded. Until then, plan as if both CBAMs apply.

Where CBAM fits with your own carbon reporting

CBAM is a tax on specific imported goods. It doesn't change what goes in your Carbon Reduction Plan or SECR report. But if you buy a lot of steel, aluminium or cement, a supplier's CBAM emissions figure is better data for your Scope 3 purchased goods than a spend-based estimate, so keep it when you get it. Our guide to the 15 Scope 3 categories explains where purchased materials fit, and our guide to answering a customer's carbon data request covers what to send back.

How Carbon Recycling helps

Carbon Recycling isn't CBAM software and doesn't file CBAM returns. It works out your own footprint from your bills and records with the government conversion factors, and keeps one set of figures you can use for every customer request, tender and Carbon Reduction Plan.