Alcohol Duty new digital service: information for compounders and rectifiers, and cider makers
18 September 2024
HMRC are writing to approved compounders and rectifiers, as well as cider makers who make small amounts of alcohol, to tell them about the new digital service they’ll be launching in March 2025 and how to get ready.
Using the digital service will make it simpler, quicker and easier for producers of alcoholic products to manage all their Alcohol Duty processes, across all types of alcoholic products subject to the duty.
This will deliver on HMRC’s commitment to offer greater digital options to customers, giving them the digital experience they expect from a modern tax and customs authority.
The new digital service is the next stage of the Alcohol Duty Review – which on 1 August 2023 saw us introducing the biggest change to Alcohol Duty in 140 years, including new duty rates based on alcohol content (ABV), 2 new reliefs (Small Producer Relief and reduced rates for draught products), as well as transitional support for some wine products.
What compounders and rectifiers need to know
When the new digital service launches in March 2025, compounders and rectifiers will no longer need to use an excise warehouse. Instead, they will need to be approved as an alcoholic product producer in the new digital service, and submit monthly duty returns and payments.
HMRC will migrate existing compounder or rectifier licenses to the new Alcohol Products Producer Approval and issue an identification number (the 'APPA ID').
What cider makers need to know
Cider makers of all sizes – including the smaller ones – will need to get approval to produce cider in the new digital service, due to launch in March 2025.
The smallest cider makers, who produce less than 5 hectolitres of alcohol in a 12-month period, will not need to submit a return on the new digital service. However, if and when they go over this threshold, they will need to submit a monthly duty return.
HMRC will issue a new APPA ID to currently exempt cider makers, and issue them with an identification number so that they can use the digital service.
HMRC will share further details on the new digital service closer to its launch date, including details on how to access it.
In the meantime, customers should remember that they need to accurately account for Alcohol Duty using the current processes. Before submitting their monthly Alcohol Duty return, they need to make sure they apply the correct rates and check if they can take advantage of the 2 reliefs.
Kindly supplied by HMRC.
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