Tobacco Products Duty
Find out if you need to pay Tobacco Products Duty if you make or import tobacco, how much it is and when you can suspend or defer payment.
Products duty is payable on
Tobacco Products Duty is payable if you make or import:
- hand-rolling tobacco
- other smoking tobacco, for example pipe tobacco
- chewing tobacco
- cigarette rag and expanded tobacco if it can be smoked without further processing
- herbal smoking products that don’t contain tobacco or tobacco substitute
Products duty isn’t payable on
You don’t have to pay Tobacco Products Duty on nasal snuff.
If specific conditions are met, you also don’t need to pay Tobacco Products Duty on:
- samples drawn for test by official bodies
- samples drawn for production or quality control
- tobacco refuse, products that aren’t fit for sale or returned products if they’re destroyed or judged unsmokeable in an approved manner
- products used for scientific research
Register for Tobacco Products Duty
If you make tobacco products you’ll need to register as a tobacco manufacturer.
As a manufacturer of tobacco products in the UK, you need to follow the legal requirements for fiscal markings on cigarette and hand-rolling tobacco.
You don’t need to register if you’re manufacturing tobacco products purely for research or experiment. In this situation you need to write to HM Revenue and Customs (HMRC) to tell them what you’re doing and give a detailed overview of your business premises.
Pay Tobacco Products Duty
Usually, you need to pay HMRC as soon as the products become liable to the duty.
Products become liable to the duty when they either:
- enter the UK from overseas
- reach a smokeable condition during manufacture
These events are known as duty points.
To make the payment, you should complete form TP7 and send it to:
HM Revenue and Customs
Tobacco Products Duty
St Mungo's Road
Duty suspension allows you to pay your Tobacco Products Duty at a later stage, which may help your cash flow. If you manufacture, distribute or import tobacco products in the UK, you may store them duty-suspended in:
- your registered factory premises if you’re a manufacturer
- your own store if it’s a registered store with HMRC
- an excise warehouse (for certain products) if they’re intended for the UK market
Duty deferment accounts
With a duty deferment account with HMRC, you can put off payment of Tobacco Products Duty for one calendar month after they pass a duty point.
Read more about duty deferment arrangements.
Records you must keep
As an importer or manufacturer of tobacco products, you must keep certain financial, business and other records.
If you import tobacco products, read about record keeping for businesses liable for Tobacco Products Duty.
If you’re a manufacturer of tobacco products, read about records that manufacturers must keep.
You must submit a return using form TP7 to HMRC on any day when tobacco products are released onto the UK market. The only exception is if you have a duty deferment account and HMRC has agreed you can submit a monthly return.
Read more on making a Tobacco Products Duty Return.
|Cigarettes||16.5% of retail price plus £207.99 per 1,000 cigarettes|
|Cigars||£259.44 per kg|
|Hand-rolling tobacco||£209.77 per kg|
|Other smoking tobacco and chewing tobacco||£114.06 per kg|
Read more on how the duty on cigarettes is calculated.
Published: 9 November 2009
Updated: 5 April 2017
- The tobacco product duty rates have been updated following the Spring Budget.
- Rates, allowances and duties have been updated for the tax year 2015 to 2016.
- Tobacco Duty rates amended following the 2014 Budget.
- First published.