Recycling of plastic waste is promoted by the European Union as an important step toward a circular economy. Recovered plastic waste is a complex and heterogeneous material, and the impurities and/or untargeted polymers associated to plastic waste may affect the recycling process and potentially decrease the intended benefits. An environmental and financial assessment was conducted on one tonne of hard plastic waste collected at Danish recycling centres. Three management scenarios were considered: two mechanical recycling (a simpler and a more advanced configuration, namely sMR and aMR) and a feedstock recycling (FR) scenario based on conversion through pyrolysis. Scenario aMR provided the largest savings in the highest number of impact categories (including global warming potential) and total costs; scenarios sMR and FR provided smaller savings (or even burdens), depending on the environmental impact category considered. A scenario analysis evaluating the type of energy provision, location of recycling facilities and the application of the recycled material confirmed the ranking of results with respect to global warming potential and total costs. A global sensitivity assessment of model data inputs demonstrated that three to nine parameters were typically sufficient to achieve more than 90% of total variance of the results; critical parameters were mainly related to sorting efficiencies, technical yields and market substitution factors. The study demonstrates that if high quality of the recycled plastic is achieved, both environmental savings and financial revenues are possible.