HMRC turns screw on duty evasion

04 January, 2016

The HMRC’s Alcohol Wholesaler Registratation Scheme is now operational.

Between January 1 and March 31, 2016, every UK wholesaler of beers, wines or spirits must apply to the scheme and prove to the HMRC inspection regime that it is not trading in duty-evading stock.

Businesses that do not apply before March 31 this year, or that apply but fail to satisfy the inspectors, will not be able to buy or sell alcohol once the scheme goes live on April 1, 2017.

From that date, retailers will also be required to ensure that any UK wholesaler from whom they buy alcohol is AWRS registered.

Potential penalties for non-compliance could include a £10,000 fine or up to seven years’ imprisonment, as well as the seizure of stock.

Guidance on the application process is available online from HMRC here.

James Bielby, chief executive of the Federation of Wholesale Distributors, said: "We have campaigned hard over the years for a clampdown on criminals in the alcohol supply chain, and AWRS is a vital step towards that.

“It will reveal those traders who are unable or unwilling to meet the 'fit and proper trader' criteria, which HMRC will be looking for through the application and inspection process.

"Together with increased investment in detection and prosecution, AWRS will help drive duty fraudsters out of alcohol, which is good news for taxpayers, and great news for legitimate distributors and retailers.”

HMRC believes the scheme is necessary to stamp down on the £1.2bn in alcohol duty and VAT evasion that it loses to fraud each year.

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