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HMRC internal manual

Beer Guidance

From
HM Revenue & Customs
Updated
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Small brewery beer: Brewing under contract

Brewing under contract may be encountered more frequently than production under licence.

  • Brewer A is asked by brewer B to produce beer on his behalf. He may, for example, have suffered a fire and cannot use his own premises or equipment. Brewer B owns the brand.
  • Brewer A produces the beer and invoices his services and material costs to Brewer B who then has full title to the beer.
  • Brewer A is not involved in the marketing or promotion of the beer.

Duty on beer produced in this way would be chargeable at the rate payable by the producer, Brewer A.

The producing brewer must include the quantity produced in his end of year production figure. This may affect his future eligibility for reduced rates of duty, which should be borne in mind.