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HMRC internal manual

Excise Due Diligence Condition guidance

General: likely impacts

A key element in tackling alcohol fraud is to ensure that the excise due diligence condition is applied properly and consistently across the sector, from production to consumption. Although a large number of businesses will carry out reasonable due diligence, others may choose to ignore risks or carry out cursory checks to appear compliant. We should challenge robustly those who are not applying due diligence properly, reminding them of their obligations. It is these businesses who may, unwittingly or otherwise, become involved with the illicit alcohol trade. Of particular risk are those in key positions, such as warehousekeepers, and those trading in significant volumes of excise goods.

Due diligence is also a requirement in other tax areas for example, VAT; VAT Notice 726 (GOV.UK) provides more detail. Where excise due diligence concerns are identified, you should also consider whether there are any wider ‘cross tax’ implications to your findings and share your concerns with appropriate teams.