UK CBAM starts on 1 January 2027: is your commodity code about to make you a CBAM importer?

A code someone chose years ago could now decide whether you owe a carbon tax. From 1 January 2027, the UK Carbon Border Adjustment Mechanism (CBAM) puts a carbon price on imported iron and steel, aluminium, cement, fertiliser and hydrogen. HMRC decides what is in scope by commodity code, not by industry.

That reaches further than most businesses expect. If you import empty cans, aluminium foil, fixings or metal fittings, you may be a CBAM importer without ever thinking of yourself as heavy industry.

This guide explains what UK CBAM is, which goods it covers, how the £50,000 threshold works, how it differs from the EU scheme, and what to put in place before 1 January.

What is UK CBAM?

UK CBAM is a new tax on the greenhouse gas emissions embodied in certain imported goods. It is designed so that imports carry a carbon cost comparable to goods made in the UK under the UK Emissions Trading Scheme (UK ETS).

It is now law. The tax sits in Part 5 of the Finance Act 2026, which received Royal Assent on 18 March 2026, and the regulations that make it work were made between July and September 2026. The scheme applies to goods imported from 1 January 2027.

The charge works like this: the tonnes of emissions embodied in the goods, multiplied by a CBAM rate the government sets for each sector every quarter, less relief for any carbon price already paid in the country of production. The rate is based on the UK ETS price.

Which goods are in scope of UK CBAM?

Five sectors are covered. Unlike the EU scheme, electricity is not included. Here are examples of the headings HMRC lists.

Where HMRC lists a heading, every subheading under it is in scope unless it is specifically excluded. The full sector-by-sector list is in HMRC's guidance, check which goods are in scope of CBAM.

Why does the commodity code decide your CBAM liability?

Because the code is the trigger. Under UK CBAM, the right commodity code puts a product in scope, and a wrong one can hide it until HMRC asks.

Look at how close some of the lines are. Two metal products that look alike on a shelf can sit either side of the CBAM boundary.

The difference between 7323 and 7326 turns on whether the article is a table, kitchen or household item. Get it wrong one way and you have under-declared a tax. Get it wrong the other way and you are tracking, recording and reporting goods that were never in scope.

Packaging needs particular care. Cans and containers imported already filled with food or drink are normally classified with their contents, so it is empty packaging that brings CBAM into play. A food or drink producer importing empty cans for its own filling line can be in scope.

The code is also the record. HMRC's CBAM regulations require you to keep the eight-digit commodity code and description of each CBAM good, with its import date, value and weight, for six years. “It has always been this code” will not stand up when the code decides a tax bill.

Who has to register for UK CBAM, and when?

The importer is liable: the business named on the customs declaration, or on whose behalf it is made. You become liable to register once the value of the CBAM goods you import goes over, or you expect it to go over, £50,000 in a rolling 12 months.

• 1 January 2027: goods imported from this date count, and your records need to start.
• By 1 January 2028: HMRC's CBAM registration service opens.
• 31 May 2028: first return and payment, covering the whole of 2027.
• From 2028: quarterly returns and payments.

The threshold is set by value, not volume. £50,000 of fixings, foil or packaging over a year is well within reach of a growing business. Some imports do not count towards it, including goods of UK origin, goods for private use, re-imports where returned goods relief is claimed, and goods held under special customs procedures until they are released into free circulation.

How is the UK CBAM charge worked out?

You can use default values or actual emissions. Default values give a standard emissions figure per CBAM good, and HMRC will use a single value for each good. Actual emissions can produce a lower charge, but need data from your supplier, independently verified.

At the time of writing, HMRC has still to publish the default values and CBAM rates. Watch for both. They will tell you what CBAM is likely to cost you, and whether chasing supplier data is worth it.

How is UK CBAM different from EU CBAM?

The principle is the same. The detail is not, and businesses trading both ways need to run two sets of rules. We covered the EU's move to its definitive phase in CBAM: what you need to know for 2026.

If you export to the EU, expect your EU customers to ask you for emissions data, because they carry the EU CBAM cost. The UK and EU agreed in May 2025 to work towards linking their emissions trading systems, which could lead to mutual CBAM exemptions. Until a linking agreement is in force, both schemes apply.

What should you do before 1 January 2027?

1. List everything metal you import. Include packaging, fixings, components and finished articles, not just raw materials.
2. Check every code against HMRC's list. Inherited codes from a supplier invoice or an old spreadsheet are where scope gets missed.
3. Estimate your 12-month value of CBAM goods. Compare it with the £50,000 threshold.
4. Talk to suppliers now. Ask for net weights, origin, emissions data and evidence of any carbon price paid.
5. Set up your records from day one. Eight-digit code, description, import date, value and weight for every CBAM good, kept for six years.
6. Decide on default values or actual emissions. Revisit the decision once HMRC publishes its default values and rates.
7. Brief your customs agent. The liability sits with you as the importer, not with the agent making the declaration.

How does TTVerified flag CBAM goods?

Every code classified in TTVerified is checked for CBAM and anti-dumping measures, and flagged automatically when one applies. You see straight away which product lines need CBAM records and supplier data, before the goods arrive.

The flag is only as good as the code behind it. That is why every TTVerified code is expert-backed: AI suggests the code, a TariffTel classification specialist verifies it, and the reasoning is logged in a full audit trail. If HMRC asks why a product is, or is not, a CBAM good, you have the answer on record.

The emissions data and the return remain your responsibility. TTVerified tells you where that work is needed, and its supplier engagement tools help you collect product data at source rather than chasing it by email.

Start with the products you are least sure of. The TTVerified 14-day free trial includes 10 classifications with no card required, or you can talk to our classification team about reviewing a full range before 1 January.