Most businesses reading about the UK carbon border adjustment mechanism have taken the figure of 50,000 pounds for an annual allowance, and have put the question aside until the end of a financial year. Paragraph 2 of Schedule 17 to the Finance Act 2026 does not work that way. The difference decides which month a business becomes liable, and which of its imports carry the tax.
Two tests, and one of them looks forward
Paragraph 2(2) sets two separate triggers, and meeting either one is enough.
The first looks back. On the first day of a month, a business adds up the value of the CBAM goods it imported in the course of a business over the preceding twelve months. If that total reaches 50,000 pounds, registration is triggered on that day. The window rolls forward each month, so a business that sits below the figure in March can cross it in April on the strength of one delivery, and nothing resets on 1 January or at the end of an accounting period.
The second looks forward. A business is also triggered if it expects to import CBAM goods of 50,000 pounds or more in the course of a business before the end of a period of thirty days. HMRC’s guidance, “Work out the date you’ll need to register”, puts the same test as an expectation of importing covered goods worth 50,000 pounds or more within the next thirty days. One order placed with one mill can trigger registration before a single tonne has moved, and the trigger does not wait for the goods to arrive.
Paragraph 2(4) then gives thirty days from the trigger to register. Regulation 2(2) of SI 2026/830 replaces that period for the opening year: a person who first triggers registration during 2027 has until 31 January 2028.
One point is worth stating as an open question rather than an answer. Section 158(1) gives Part 5 effect in relation to goods imported on or after 1 January 2027, and HMRC’s guidance describes the look-back as running monthly from 1 January 2027. Whether the twelve-month window may reach goods imported before that date is not settled by the provisions read for this briefing, and a business close to the figure in the early months of 2027 should put the question to HMRC rather than assume the more comfortable answer.
What actually counts towards the figure
The value is the customs value. Regulation 3 of SI 2026/802 fixes it, so the figure is not the invoice total, not the landed cost and not the price the goods are sold on for.
Only CBAM goods count. A consignment that carries covered steel fittings alongside goods outside Schedule 16 contributes the customs value of the fittings and nothing else. That means the tally cannot be taken from a purchase ledger or from a freight invoice. It has to be assembled from the covered lines of each customs declaration, by eight-digit commodity code, which is the same exercise the return will demand later.
Liability begins before registration is possible
This is the part that catches businesses out, and it follows from the wording rather than from any policy statement.
Section 147(1) provides that CBAM is not charged where the importer is, at the time of import, neither registrable nor registered, or imports otherwise than in the course of a business. A registrable person is one who has triggered registration and has not yet registered. The exemption therefore falls away on the day the test is met, and not on the day the business appears on a register.
Set that against the timetable. HMRC’s collection “Check if you’ll need to register” states that registration for CBAM will open by 1 January 2028, and a business triggering in 2027 has until 31 January 2028 to register. A business that crosses the figure in, say, March 2027 is liable on its imports from that point, while the service through which it would register may not exist for another nine months. Nothing about that gap reduces the liability. It simply means the evidence for the first return has to be gathered long before there is any account to file it against.
The record-keeping duty is written to match. Regulation 5 of SI 2026/802 applies to anyone who imports a CBAM good in the course of a business, whether registered or not, and requires the eight-digit commodity code and description, the date of import, the value and the weight. A business waiting to see whether it crosses the figure is already required to keep the records that prove whether it did.
Splitting the imports does not work
Paragraph 16 of Schedule 17 lets HMRC direct that persons who are connected, and who have artificially separated their activities, are treated as one taxable person. A group that routes covered goods through two companies so that neither reaches 50,000 pounds is describing exactly the arrangement that paragraph addresses. Where the separation is genuine and predates the tax, the position is different, and it is worth recording why the structure exists while the reason is still fresh.
What to do before January
Build the monthly tally now, from the customs declarations rather than from purchasing. For each month, take every declaration line whose eight-digit code falls within Schedule 16, record the customs value and the net weight against that code, and keep a running twelve-month total that is read on the first day of each month. The registration threshold calculator applies both limbs of the test to the figures once they exist, and the commodity code index settles which lines belong in the tally. A business that has that spreadsheet by 1 January 2027 will know the day it becomes liable. A business that does not will find out later, from a figure it has to reconstruct.
What this affects
Chapter 9 of UK CBAM for Importers covers the same ground in full.