Fortification and classification
Fortification is where spirits are added to wine or made-wine to increase the alcoholic strength of the product. A producer can only fortify wine or made-wine in a trade facility excise warehouse approved for the purpose. A wine producer will need a trade facility warehouse in addition to his winery licence if he wishes to receive and store duty free spirits for fortifying, or beer, cider or imported wine for use in the production of wine or made-wine.
The general procedures for operations in a trade facility warehouse can be found in Notice 197 (GOV.UK).
Wine or made-wine can be fortified with added alcohol, provided the final strength of the fortified wine or made-wine does not exceed 22% ABV and the resulting product would not be classified as a spirit under the Integrated Tariff of the UK. If wine or made-wine is fortified to a strength above 22%, or the resulting product would fall to be treated as a spirit under the Tariff, then the product will be dutied in line with the spirits rate.
Paragraph 25.7 of Notice 163 (GOV.UK) gives guidance to help in determining the duty liability of a product. Factors to be considered are overall volume of the product, alcoholic content, taste, smell and how the product is marketed.