Records suggest that the Permo-Triassic mass extinction (PTME) involved one of the most severe terrestrial ecosystem collapses of the Phanerozoic. However, it has proved difficult to constrain the extent of the primary productivity loss on land, hindering our understanding of the effects on global biogeochemistry. We build a new biogeochemical model that couples the global Hg and C cycles to evaluate the distinct terrestrial contribution to atmosphere-ocean biogeochemistry separated from coeval volcanic fluxes. We show that the large short-lived Hg spike, and nadirs in δ Hg and δ C values at the marine PTME are best explained by a sudden, massive pulse of terrestrial biomass oxidation, while volcanism remains an adequate explanation for the longer-term geochemical changes. Our modelling shows that a massive collapse of terrestrial ecosystems linked to volcanism-driven environmental change triggered significant biogeochemical changes, and cascaded organic matter, nutrients, Hg and other organically-bound species into the marine system.