The answer is the same for burying toilet paper as it is for burying poop:
see: When is it not OK to leave feces behind?
Burying toilet paper with your poop is acceptable in areas where it can break down and decompose. If you are in arid dirt that doesn't get much moisture, or in rocks or sand, then it is not acceptable to bury toilet paper. Paper is considered compost, but just make sure it's properly buried with your stool, and that your stool is in itself properly buried in accordance with leave no trace ethics:
Toilet Paper:
Use toilet paper sparingly and use only plain, white, non-perfumed brands. Toilet paper must be disposed of properly! It should either be thoroughly buried in a cathole or placed in plastic bags and packed out. Natural toilet paper has been used by many campers for years. When done correctly, this method is as sanitary as regular toilet paper, but without the impact problems. Popular types of natural toilet paper include stones, vegetation and snow. Obviously, some experimentation is necessary to make this practice work for you, but it is worth a try! Burning toilet paper in a cathole is not generally recommended.