Two new beer duties are introduced from 1 October 2011.
High Strength Beer Duty (HSBD) will be due on beer which exceeds 7.5% alcohol by volume (abv) and is produced in or imported into the UK. HSBD will be paid in addition to the existing general beer duty and is set at 25% of the general beer duty rate. At the time of introduction this is £4.64 per hectolitre % of alcohol in the beer.
From the same date, a reduced rate of general beer duty for lower strength beer will apply to beers exceeding 1.2% abv but not exceeding 2.8% abv, and which are produced in or imported into the UK. The new reduced rate is set at 50% of the general beer duty rate, which at the time of introduction is £9.29 per hectolitre % of alcohol in the beer.
Small Brewer's Relief is still available on the general beer duty element of beer above 7.5% abv. However, it does not apply to HSBD and no further relief will be applied to the reduced rate for lower strength beers.
You should use the same accounting/duty declaration procedures that already apply to general beer duty for HSBD and the new lower rate of general beer duty.
EX46 the beer duty return has been updated to accommodate the taxation changes and will be published on the HMRC website on 17th October 2011. However, monthly returns will continue to be sent by the Beer Duty Accounting Centre, Cumbernauld for completion and return.
Other forms such as the W5/W5D only require the declarant to include the appropriate new tax type. The following 4 tax types have been created to account for the new duties.
444 - UK produced beer exceeding 1.2 % abv but not exceeding 2.8% abv
445 - UK produced beer exceeding 7.5% abv (High Strength Beer Duty)
446 - Imported beer exceeding 1.2% abv but not exceeding 2.8% abv
447 - Imported beer exceeding 7.5% abv (High Strength Beer Duty)
For beer exceeding 7.5% and liable to both HSBD and general beer duty it will mean that, where required, for example on a W5/W5D, the tax type for both general beer duty and HSBD must be shown on the accounting document.
The table below shows an example of how the new duties should be entered on form W5/W5D
In this example:
| Tax Type | Quantity (in hectolitres %) | Rate of duty | Amount of excise duty |
|---|---|---|---|
| 407 (GBD) | 176 | £18.57 | £3,268.32 |
| 445 HSBD) | 176 | £4.64 | £816.64 |
| Total Excise Duty | £4,084.96 |
There is no change to the completion of a W1, for beer held in an excise warehouse. You do not need to include separate stock figures for HSBD or beer subject to the reduced rate of general beer duty. The return is inclusive of all beers.
The Tariff will be updated in time for the introduction of the taxation changes. An update to Notice 226 Beer Duty will be published on the HMRC website on 17th October 2011.
