HMNCT3040 - Detail of the scheme: What must traders do to comply with the requirement?

Notify our contact point immediately on a completed form W7 (Notification of Cash Payments for Goods or Services in Duty Suspension) of all cash payments over £9,000 received for the sale of duty suspended alcohol and alcoholic beverages, or received for the provision of an alcohol related service for duty suspended goods. Traders are also required to submit a W7 if they refuse to accept a cash payment from a customer.

What types of payments are treated as being cash?

For the purpose of this requirement cash is defined as: “cash means notes, coins or travellers cheques in any currency”. This is in line with Regulation 2 of the Money Laundering Regulations 2003.

How do traders notify HMRC of cash payments?

All W7 notification forms must be sent to the National Warrant Processing Unit (NWPU) via fax or e-mail.

Fax number 0131 469 7321

E-mail – sco.wpu@hmrc.gsi.gov.uk

Form W7 form is available from the HMRC Internet site.

When are traders required to notify HMRC of cash transactions?

Traders must notify the ACCT immediately (i.e. without undue delay) following the receipt of cash payments. Traders are requested to submit form W7 as early as possible. For example a trader may know from the outset that they will be paid in cash and a notification at this time will allow the ACCT to undertake a risk evaluation before duty suspended goods are despatched.

How should traders treat cash payments that are made in several instalments?

It may be commercial practice for some customers to pay cash for goods or services in two or more instalments. For example a customer may pay for a supply of goods costing £10,000 in two cash instalments of £5,000. As the total value of the sale and cash to be received exceeds the £9000 notification threshold this should be notified on form W7 when the first cash payment is received.

Officers should consider as part of their assurance test of a trader’s credibility how transparent a trader’s operations and procedures are with respect to the buying and selling of duty suspended alcohol. Where a registered alcohol trader dealing in cash appears to operate in an unnecessarily complicated manner, officers should consider if these arrangements are deliberately complex to confuse the audit trail. Officers should consider whether that trader remains suitable for approval and registration under HMRC’s registration policy set out in X99 Alcohol Strategy – Registration and Approval guidance along with any other compliance problems or credibility concerns encountered.

Suggested good practice for submitting cash notifications

Responsibility for complying with this requirement will,

• in a production site rest on the producer,
• in a warehouse rest on the warehousekeeper, and
• in the case of a registered owner, or a duty representative, on that person.

Although there is no requirement to appoint and identify a particular nominated official it is strongly recommended that companies designate an identifiable contact point to deal with notifications to ensure compliance with this requirement. Officers are strongly encouraged to discuss arrangements for notifying cash transactions when carrying out assurance activity at registered traders who receive cash payments.

Procedures for recording and notifying cash transactions should be established and recorded within the trader profile.