Check if you’re eligible for Small Producer Relief on Alcohol Duty
Who can get the relief, when to check your eligibility and how to work out your discounted duty rates.
Who can get the relief
If you’re a small producer you may be able to pay a lower rate of Alcohol Duty on any product with an alcohol by volume (ABV) of less than 8.5%.
You can get Small Producer Relief if:
- the products you made in the previous production year contain 4,500 hectolitres or less of pure alcohol
- you reasonably expect that the products you make in the current production year will contain 4,500 hectolitres or less of pure alcohol
- less than half of the total alcohol you produce in a production year is made under licence
When to check your eligibility
The production year for Small Producer Relief is 1 February up to and including 31 January.
You must:
- check your eligibility and work out your duty rates at the end of every production year
- have estimated your alcohol production for the next production year before you calculate your discounted rates
If you go over the small production threshold of 4,500 hectolitres in a production year
You are no longer eligible for the relief and the full rate of duty will apply to the products you make both:
- from that point onwards in the current year
- in the following production year
HMRC may also assess you for the difference between the reduced rate paid up until that point and the full rate.
Check if your products are eligible
You may be able to pay less duty on:
- beer
- cider, including perry
- spirits, including spirit based ready-to-drink (RTD) products
- wine, including sparkling and fortified wines
- other fermented products (previously called made-wine) like fruit ciders
You can only get relief on products:
- with an alcoholic strength of less than 8.5% ABV
- not made under licence
- in Northern Ireland if they are eligible
Products made under licence
This can be when:
- the terms of a licence restrict the making and selling of the product
- you sell the product as yours but for example, the packaging states ‘produced under licence’
- you pay the brand owner royalties or a premium
- you have the right to make an existing brand of alcohol but the name and intellectual property rights are owned by another producer
You cannot get relief on products made under licence but you can get it on products made under contract.
Products made under contract
This can be when:
- you ask another producer to make an alcoholic product for you
- you pay another producer a service charge to make a product for you
- another producer is not involved in the marketing or promotion of the product
You can get relief on products made under contract at the reduced rate of the producer that makes them.
Eligibility for Northern Ireland
You can get Small Producer Relief in Northern Ireland if you meet both the:
- 4,500 hectolitre threshold for pure alcohol and all other eligibility criteria
- individual production thresholds for the different product types
| Product type | Northern Ireland production threshold (per year) |
|---|---|
| Beer | 200,000 hectolitres of finished product |
| Wine, including sparkling and fortified wines | 1,000 hectolitres of finished product |
| Cider, including perry and other fermented products like fruit ciders | 15,000 hectolitres of finished product |
| Spirits, including spirit based ready to drink products | 10 hectolitres of pure alcohol |
To work out the individual production threshold for each type of finished product use the same rules as for pure alcohol production.
You must include:
- each type of finished product made in the previous year
- your estimated production for each type of finished product for the current year
- all the alcoholic products you make at all your premises
If your production levels go over the threshold for an individual product type, you must pay the full rate of duty for those products.
You may still be eligible for the reduced rate on other products you make.
If you supply products from Great Britain that do not meet the Northern Ireland eligibility criteria
If you are sending products to Northern Ireland duty-paid you can either record the:
- full rate of duty for the products on your return
- Small Producer Relief rate on your return and pay the extra duty when the products are moved
The extra duty will be the difference between the:
- Small Producer Relief rate paid
- full rate of duty for those products
If you do not want to send the products duty-paid, you can move them under duty suspense, if you are approved to do so.
If you’re not sure the products will be consumed in Great Britain (England, Scotland and Wales) when you send them duty-paid, you must provide the following information in your commercial documents:
- the Small Producer Relief rate paid
- confirmation that the annual production for that product type is over the relevant threshold
This information must accompany the products as they move through the supply chain. This will allow someone further down the supply chain, who moves the goods to Northern Ireland, to make sure the correct amount of duty has been paid.
Find out more about how to pay extra duty using the excise duty offset mechanism.
If you supply products from Northern Ireland that do not meet the Northern Ireland eligibility criteria
If you’re sending the products to Great Britain duty-paid, you can pay the Small Producer Relief rate and record it on your return.
If you do not want to send the products duty-paid, you can move them under duty suspense, if you are approved to do so.
How to work out your annual alcohol production
To check if you meet the 4,500 hectolitre threshold, you must work out your annual alcohol production.
You can work out a product’s pure alcohol content by multiplying its volume in hectolitres by its ABV.
You must include the total amount of pure alcohol contained in all the alcoholic products you make at all your premises.
Your total pure alcohol production must be 4,500 hectolitres or less for the products you:
- made in the previous production year
- estimate you will make in the current production year
Do not include any products that were:
- spoiled
- thrown away
- produced in the process of making another alcoholic product for example, if you produce wort when making beer
If you’re part of a group or have merged with, or separated from another business
Find out how your business set up can affect your eligibility for Small Producer Relief.
If you sell your product to another producer and they use it to make another alcoholic product
You must both count the pure alcohol content of your own final products in your production volumes.
If you mix another small producers alcoholic products with yours
You can only do this if duty has not already been paid.
You must both count the pure alcohol content of your own final products in your production volumes.
If you make a product that needs to mature
You must count the pure alcohol content from when it was made and not the final product.
If you make products under licence
You must count the pure alcohol content of the final products you make under licence in your production volumes.
If you make products under contract for another producer
You must count the pure alcohol content of the final products you make under contract in your production volumes.
If your premises were used for making alcoholic products for only part of the previous year
You must use the figures you have to work out your 12 month production figure.
You should:
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Divide the amount of pure alcohol produced by the number of days on which production started.
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Multiply that amount by 365 (the number of days in the production year).
If you import alcoholic products
You can check with an overseas producer to find out if their products are eligible for the relief.
If they are eligible, you must ask for a certificate that:
- confirms they meet the eligibility criteria
- is endorsed by the authorities of the country where the product is made
You must keep the certificate with your records to prove you can pay a discounted duty rate.
Find out how much relief you can get
You can use the online calculator to find out how much Small Producer Relief you can get.
If you want to do your own calculations, find out how to work out your Alcohol Duty rates.
If you move or receive alcoholic products in duty suspense
If you move products
You’ll need to use the Excise Movement and Control System (EMCS) to move products in the UK unless you can use simplified procedures for certain intra-UK movements.
You must include the statement ‘It is hereby certified that the alcoholic product described has been produced by an independent small producer’ on either:
- the electronic administrative document (eAD) if you use EMCS
- a certificate of eligibility with any commercial document if you use simplified procedures
You must also provide the annual production of the previous production year in hectolitres of pure alcohol. This must be 4,500 hectolitres or less to be eligible for Small Producer Relief.
You must give details of your Small Producer Relief rate to the person who will pay the duty. This will help them work out how much duty to pay when the products leave duty suspense.
Read more about the registration and approval of excise goods held in duty suspension and receiving goods into and removing goods from an excise warehouse.
If you receive products
You need a certified eAD or a certificate of eligibility which shows the statement and details that were provided by the producer. You should keep this in your records or you will not be able to:
- show that the alcoholic product was made by a small producer
- account for the duty on the alcoholic product at the Small Producer Relief rate
If you move small producer beer in the UK which has been made by someone else
If you operate brewery registered premises or an excise warehouse, you’ll need to keep the certified eAD or the certificate of eligibility which shows the statement and details that were provided by the original producer.
If you move the beer to someone else authorised to move and hold it in duty suspense, you must provide the same information that the original producer gave on either:
- the electronic administrative document (eAD) if you use EMCS
- a certificate of eligibility with any commercial document if you use simplified procedures
If the products do not meet the Northern Ireland eligibility criteria
You must also confirm the products are over the relevant annual production threshold for that product type.
Last updated 17 October 2023 + show all updates
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The online calculator in section ‘Find out how much relief you can get’ has been moved to the guide ‘Find out your Small Producer Relief rates’.
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Added translation
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The section 'check if your products are eligible' has been updated to explain the difference between products made under contract and those made under licence. Also included more details about what you need to do if you're moving or receiving alcoholic products in duty suspense.
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Added translation