Ask the Collective
The questions independent drinks founders ask most — answered. Distilled from years of community knowledge so the good stuff never disappears in the feed again.
How can small UK distillers effectively advocate for government duty relief similar to small brewers' relief?
Members emphasize that despite years of lobbying via organizations like the WSTA, securing small distiller duty relief has proven extremely difficult. The movement lacks the parity small brewers already enjoy, putting craft distillers at a structural disadvantage, particularly during duty change periods when larger producers can prepay duty on stockpiled inventory using capital reserves. **Key advocacy channels and tactics:** - **WSTA (Wine & Spirit Trade Association)** — the primary trade body members have been lobbying through; their homepage hosts example letters, government contacts, and press releases to support campaigns - **Direct MP engagement** — members recommend writing to or securing face-to-face meetings with local MPs rather than social media campaigns; the collective here spans dozens of constituencies, offering multiple entry points - **Coordinated letter campaign** — draft a template letter with quantifiable comparables and facts (e.g., small brewers' relief thresholds, disadvantages of small vs. large producers), then circulate for mass sign-off; one member proposed a DocuSign petition targeting 200+ signatures from the ~350 UK craft distillers - **Parliamentary champion strategy** — identify an MP with weight on the benches who is passionate about the issue, build internal support among other MPs contacted, then bring the case to Commons debate - **International precedent** — Australia's craft distillers secured $100k excise-free threshold (later raised to $350k, roughly paralleling small brewers' relief), enabling 400+ craft distillers to operate viably; using this as a policy template strengthens the UK case **Key comparables and facts to include in advocacy:** - Small brewers' relief exists; small distillers have none (parity argument) - Duty-change lead times benefit large producers with cash reserves; small producers cannot prepay or build stock competitively - Proposed Australian threshold model: no excise on first $1M or 12,000 bottles sold; $30/bottle above that **Caveats:** Members express significant frustration, with one noting "pissing in the wind" — five years of parliamentary visits and channels have yielded no government response. There is skepticism about short-term success without a change of government.
How should small producers respond when HMRC rejects or reverses duty relief claims, and what documentation helps challenge denials?
HMRC claim reversals are a growing problem for small producers, with members reporting successful claims being demanded back months after payout, often after random selection for further checks. Here's what the community has experienced: **The problem:** - Claims are being reversed 12+ months after initial approval, with HMRC issuing minimal written justification (often one-liners like "Not qualifying") and providing no signed correspondence or named officer to engage with - Members have submitted extensive documentation (50+ pages in some cases) and still received blanket rejections - HMRC appears to target small businesses specifically because they lack resources to mount formal challenges or hire tax barristers - Hundreds to low thousands of small businesses are currently having reversals imposed **Recommended approach:** - **Document comprehensively**: Gather detailed records from producers, storage partners, and your own operations—members report HMRC requests information from the full supply chain, not just your own submission - **Prepare formal responses**: When challenged, submit written replies addressing each of HMRC's points explicitly, even if their feedback is vague - **Seek peer guidance**: Members share templates and documentation approaches via direct message; ask within the community for examples of successful rebuttals or WOGR (Wines, Spirits and Other Goods for Resale) clause submissions **Key caveat:** Correspondence is now unsigned and officers are unreachable, making it extremely difficult to escalate or discuss disputes directly. Small producers without tax representation are at a significant disadvantage. Members recommend connecting with others facing similar reversals to share strategies and evidence templates.
Can a drinks producer qualify for Small Producers Relief on alcohol duty if their base alcohol is imported from a non-small producer?
The regulatory text suggests that imported base alcohol must also come from a qualifying small producer to access Small Producers Relief, which creates a challenge for RTD makers sourcing from large international suppliers. **Key findings from member experience:** - The official guidance (https://www.gov.uk/guidance/check-if-youre-eligible-for-small-producer-relief-on-alcohol-duty) appears to require the supplying producer to also be a small producer, which excludes most large US alcohol suppliers. - **HMRC's interpretation is unclear and inconsistent.** Members report that HMRC internally disagrees on what constitutes "alcohol production," suggesting the rules may be applied differently depending on who you speak to. - One member suggested a potential workaround: establishing a small UK SPV (special purpose vehicle) to purchase and re-supply the imported alcohol, creating a chain where the immediate supplier is a small UK entity. This is technically possible but members acknowledged it sits in ethically grey territory and its legitimacy is unverified. - No members confirmed successfully using this approach or obtained explicit HMRC clearance for it. **Recommendation:** Before committing to a restructuring, contact HMRC directly to confirm their current interpretation, as the scheme's definition of "production" appears to be under internal debate. Members suggest being cautious of workarounds without explicit written approval.
How do small spirit producers apply for small producer duty relief and what documentation is needed?
Small producer relief (SPR) requires an HMRC tax certificate, despite initial confusion about whether the scheme is self-regulated. **Application and certification:** - You must apply to HMRC to get a tax certificate showing approval to use the new relief code. This is not purely self-regulated; the certificate is mandatory. - The responsibility to calculate relief correctly and apply the code falls on you as the producer, but you cannot proceed without the certificate first. - If you use someone else's production facility (e.g. a bond or contract manufacturer) that is larger than you, you will likely be ineligible, even if you are a small producer. The relief applies only if you are actually producing under your own operation. **Eligibility scope:** - SPR applies to spirits producers, not just brewers or low-ABV products. - For made wine, the relief is capped at 8.5% ABV; the rules may differ for spirits. - Members recommend checking the official [HMRC guidance](https://www.gov.uk/guidance/check-if-youre-eligible-for-small-producer-relief-on-alcohol-duty) for current eligibility criteria. **Member experience:** One member reported that their bond (Chichester Bond) initially said they could apply the new code themselves, but clarified that HMRC certification was required first. The relief makes a material difference to duty costs if you qualify.