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Alcohol wholesaler registration scheme

26 January 2017: Update to the alcohol wholesaler registration scheme

Wholesale businesses are already required to meet certain standards and be approved by HMRC prior to trading.

From 01 April 2017, any Licensee found purchasing stock from an unregistered wholesaler could be fined up to £10,000.00 and have their goods confiscated.

Licensees will need to carry out sufficient due diligence checking the authenticity of the wholesaler before they do business with them.  They will be able to check whether a supplier is registered by using a new online facility available via the GOV.UK website.

This will allow trade buyers to look up the details of their suppliers to ensure that they are approved under the AWRS scheme.

Basically Licensed premises will need to ensure that they are sourcing their alcohol from HMRC approved wholesalers.

The scheme has been introduced to tackle the estimated alcohol duty fraud costs of £1 billion pounds a year.

For further information, please contact Andrew Cochrane.

21 September 2016: The alcohol wholesaler registration scheme explained

This scheme applies to the whole of the UK and this scheme will affect all Licensed businesses.

The Alcohol Wholesaler Registration Scheme requires Wholesalers (e.g. cash and carry) to be registered with HMRC. Wholesales are any sale of alcohol made to another person for trade purposes. Existing Retailers who knowingly sell alcohol products to other businesses needed to register as an alcohol wholesaler under the AWRS scheme before the 1 April 2016. Wholesalers beginning to trade after the 31 March 2016 must apply to HMRC at least 45 days before they intend to begin trading and cannot begin to trade unless HMRC approval is granted.

The application for registration is free and can be done online at www.gov.uk/guidance/the-alcohol-wholesaler-registration-scheme.awrs
Retailers who buy alcohol from others for onward sale to the public from the 1 April 2017 must check that the persons from whom they buy alcohol for these purposes are registered under the Alcohol Wholesaler Registration Scheme. If alcohol is purchased from a non-registered Wholesaler the non-registered Wholesaler and the trade purchaser may be prosecuted unless it is an incidental sale – for example, a one-off purchase from a corner shop by a restaurateur who has run out of a particular alcohol product.

Trade buyers will be able to use an online lookup service of approved wholesalers to check that the Wholesalers they buy from are registered from April 2017. Before then Government guidance is that a Retailer should ask suppliers if they have applied to HMRC for approval and if the supplier has not yet applied encourage them to do so.

If you sell to trade you should already be registered. It is a criminal offence if you sell alcohol to trade and are not registered. From the 1 April 2017, it will also be a criminal offence if you purchase alcohol from a Wholesaler is who is not registered.

If you need help on the issues raised in this note or any other Licensing matters please contact Andrew Cochrane.

04 April 2016: The Government has issued a reminder to all businesses selling alcohol by retail to register for the alcohol wholesaler registration scheme by the 31 March 2016.

Under the scheme, any Retailer selling alcohol to another business will need to apply to register for the alcohol wholesaler registration scheme which was introduced by HM Revenue and Customs to tackle alcohol fraud. The deadline for existing businesses or new businesses starting before the 31 March is the 31 March 2016. Any businesses starting after March deadline must register within 45 days of starting a trade.

If you only sell alcohol to the general public and not to other businesses you will not need to apply, however, you should apply for approval if your business is established in the UK and supplies alcohol to other businesses at or after the point at which excise duty becomes due.

For further information, please contact Andrew Cochrane.

30 September 2015: The Alcohol Wholesaler Registration Scheme was introduced on 01 January 2016 by HM Revenue and Customs to tackle alcohol fraud.

The scheme will apply to existing and new wholesalers of alcohol trading at or after the point at which excise duty has become payable. From April 2017, all businesses who trade in or retail alcohol will need to make sure that any UK Wholesalers that they buy from are registered with HMRC. The type of businesses who will be affected includes alcohol wholesalers including microbrewers and small producers, brokers, auctioneers and alcohol retailers.

From 01 January 2016, HMRC will start to review all Alcohol Wholesaler Registration Scheme applications to decide whether businesses are fit and proper to be accepted onto the register. Where a business fails the fit and proper test HMRC will remove its right to trade in wholesale
alcohol.

From April 2017, all businesses who trade in or retail alcohol will need to make sure that any UK wholesalers that they buy from are registered with HMRC. HMRC is to provide an online service so that trade buyers can ensure wholesalers they buy from are registered with HMRC.

Alcohol wholesalers need to submit their Alcohol Wholesaler Registration Scheme application between 01 January and 31 March 2016.
New wholesalers who commence trading after 31 March 2016 must apply for registration at least 45 days before they wish to start trading. They will not be able to start trading until HMRC have ensured their fit and proper status otherwise, they will be subject to a penalty.

HMRC will be looking to make sure there is no evidence of illicit trading, that the person running the business hasn’t previously been involved in any significant revenue non-compliance or fraud; that there are no connections between the business or key persons involved in the business with other known non-compliant or fraudulent businesses; that key persons in the business have no unspent criminal convictions which HMRC consider relevant for example offences involving any dishonesty or links to organised criminal activity; that the application is accurate and complete and there has been no attempt to deceive; that there have not been persistent or negligent failures to comply with any HMRC record keeping requirements; that the applicant hasn’t previously attempted to avoid registration and traded unauthorised; that the business has provided sufficient evidence of its commercial viability and/or its credibility; that there are no outstanding unmanaged HMRC debts or a history of poor payment and that the business has in place satisfactory due diligence procedures to protect it from trading in illicit supply chains.

Where a business fails the scheme’s fit and proper test HMRC may remove a business’s right to wholesale alcohol at any time during the introduction of the scheme.

Penalties for wholesalers trading without having submitted their application to HMRC will start from 01 April 2016 and penalties for trade buyers who purchase alcohol from unregistered wholesales will start from 01 April 2017. In addition, any alcohol found on the premises of unregistered businesses may be seized whether or not the duty has been paid.

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