New digital changes to alcohol excise duty from 2025.
New digital changes to alcohol excise duty from 2025..
In March 2025, a new digital service will be introduced to simplify excise duty management processes for alcohol producers, including rectifiers, compound alcohol producers and cider makers. This is part of an ongoing review of alcohol excise that is bringing significant changes for the industry.
Digital handling of excise duties
The new service will make it quicker and simpler to manage all alcohol tax obligations, offering producers a more intuitive excise process. This is a key step towards modernising the tax system, in line with HM Revenue and Customs' (HMRC) aims to provide a better digital service to its customers.
Next stage of the Alcohol Excise Review
The reform, which began on 1 August 2023, introduces the biggest changes to alcohol excise duty in 140 years. Key elements of these changes include:
- Exemption for Small Producers: Small alcohol producers can benefit from preferential tax conditions. The exemption covers producers who meet certain production limits, allowing them to pay lower tax rates.
- Reduced rates for cask products: Reduced excise duty rates have also been introduced for products sold from the cask. These reductions are designed to support traditional methods of selling and distributing alcohol, particularly in catering establishments, which can benefit producers of cask drinks.
Changes for producers of complex alcohols and rectifiers
From March 2025, producers of complex spirits and rectifiers will be required to:
- Obtain approval as a producer of alcohol products in the new digital service.
- Submission of monthly tax returns.
- Make monthly payments of excise duty.
In addition:
- HMRC will automatically transfer existing licences to the new 'Alcohol Products Producer Approval' service.
- A new identification number (APPA ID) will be assigned.
Changes for cider producers
From March 2025, all cider producers will have to:
- Obtain approval for cider production in the new digital service.
- Submit a monthly tax return if production exceeds 5 hectolitres of alcohol in a 12-month period.
In addition:
- The smallest cider producers (less than 5 hectolitres) will not have to make a declaration as long as they do not exceed this limit.
- HMRC will assign a new APPA identification number to all cider producers, including those currently exempt from declaration.
Reminder of current obligations
Until the new digital system is in place, alcohol producers should continue to use their current excise duty accounting processes, making sure they are using the correct rates and considering their exemptions.
Support J. Dauman Logistics
If you have any questions or concerns about the upcoming changes, J. Dauman Logistics offers full support. Please do not hesitate to contact us for assistance in adjusting to the new requirements and a smooth transition.
