CIDER05013 - Draught Relief

Draught Relief

Draught relief was introduced on 1 August 2023 and allows producers to pay a reduced rate of duty on products packaged in qualifying draught containers. This reduced rate is used in place of the standard rate, if the producer also qualifies for SPR then they should subtract their SPR discount from the draught rate for qualifying products.

Further information on Draught Relief and the duty rates for draught products can be found here.

The law for Draught Relief is found in Section 50 to 53 of the Finance (No.2) Act 2023.

Eligibility for Draught Relief depends on whether the product is a ‘qualifying draught product’. A qualifying draught product is a product that is:

    1. of an alcoholic strength of less than 8.5%, and
    2. at the excise duty point is contained in, or is being transported to a place in the United Kingdom for the purpose of being transferred to, a large draught container.

    To note:

  1. Alcoholic products produced in the UK by a person who does not have an approval to produce alcohol (under section 82 of Finance (No.2) Act 2023) can never be eligible for the reduced rates under Draught Relief. 
  2. A “large draught container” is a container which is:
    • is of a capacity of at least 20 litres; and
    • incorporates, or is designed to connect to, a qualifying system for dispensing individual drinks
  3. A “qualifying system” means either:
    • a pressurised gas delivery system, or
    • a pump delivery system
  4. HMRC may, by regulations, amend either the capacity of a qualifying container or the description of a qualifying system.
  5. More information about Draught Relief, including some example calculations, can be found here.
  6. The legislation for Draught Relief is found in Section 50 – 53 of Finance (No.2) Act 2023.