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HMRC internal manual

Holding and Movements - Duty Stamps

When a Stamp May Be Applied: Registered Excise Dealer and Shippers (REDS)

REDS are revenue traders (governed largely by provisions under part V of the Excise Goods(Holding, Movement, Warehousing and REDS) Regulations 1992) who are permitted to receiveduty suspended goods from other Member States but are not permitted to hold them, ordispatch them, in duty suspension. The duty point on excise goods acquired by REDS iscreated at the point the goods are received by the REDS principal or, in the case of REDSagents, when they are received by the person on whose behalf the REDS is accounting forthe duty. Duty is accounted for at this point, but paid by deferment at a later date.

REDS principals and agents are able to acquire goods which have already had duty stampsaffixed by their suppliers in other Member States. Their suppliers may already haveapplied the duty stamps themselves, either incorporated into the bottle label, or theymight have obtained freestanding stamps. Alternatively, the REDS can acquire freestandingstamps themselves from HMRC’s contractor and send them to their suppliers forapplication overseas before the goods enter the UK. REDS can also obtain the design of thestamps and pass this to their suppliers so that the stamp can be incorporated into thebottle label.

One of the conditions of the duty stamps scheme is that stamps must be affixed tobottles before the duty point. The effect of this would be that REDS principals, or anyoneusing a REDS agent, could not have stamps affixed in the UK. So, in order that REDS canacquire unstamped goods and affix stamps in the UK, there is an exception that allows themto apply stamps after receipt of the goods and therefore after the duty point. In thesecircumstances, the goods must be held in the UK at premises notified at the time ofordering the stamps and stamped within 14 days of receipt of the goods. The offence forpossessing or transporting unstamped goods is disapplied for that 14 day period unless theunstamped goods are held at premises other than those notified at the time of ordering thestamps.

This exception is also applicable to anyone who arranges for a REDS agent to accountfor duty on their behalf. Where this happens, the REDS agent can acquire stamps and sendthem to his principal for affixing to the goods.

REDS retain responsibility for ensuring that the stamps are affixed to product withinthe 14 days, even when they have passed them on, or arranged for direct delivery to, theperson actually receiving the goods.