New Alcohol Duty Rules Set to Take Effect in February 2025

The UK government is implementing significant changes to alcohol duty regulations, which will come into force on 1st February 2025. These changes are part of the Finance (No. 2) Act 2023. Here’s a breakdown of what you need to know:

What's Happening?

The government is rolling out new provisions under Part 2 of the Finance (No. 2) Act 2023. These measures affect the production, approval, and taxation of alcoholic products. The regulations include:

1. Spoilt Alcoholic Products: New rules for handling spoilt alcohol.
2. Production Approvals: Mandatory approvals for producers, with exemptions for personal consumption and research.
3. Penalties and Forfeiture: Updated penalties for non-compliance.
4. Goods Removal and Drawback: Adjustments to how goods are removed and duty drawbacks are handled.

Transitional Arrangements

• Existing licences and registrations for alcohol production will automatically convert to approvals under the new system.
• Payments and returns for products with duty points before the change will follow previous regulations.

Revoked Regulations

Several older regulations will be revoked, including those for cider, wine, and spirits, streamlining the legislative landscape.

Why Does it Matter?

These changes aim to modernize and simplify the alcohol duty system, aligning it with current economic and production realities. Businesses involved in the production and sale of alcohol should prepare for the new approval processes and compliance requirements to avoid penalties.

Where Can I Find More Information?

The full details of these changes are available on the government's legislation website. A Tax Information and Impact Note was also published on 23rd March 2023, outlining the expected impacts of these reforms.