What's the process with HMRC if I want to sell my beer

[Garry247]

Hi,
I’m looking into selling beer in the UK on a very small scale as a kind of paid hobby and have seen there are a few things that need to happen.
1. Get in touch with HM Revenue & Customs for duty purposes.
2. Get in touch with local environmental health organisation (EHO)
I know i will need to pay a Beer Duty:
Duty: Brewers with an annual production of not more than 60,000 hectolitres may be eligible for a reduced rate of duty (This is currently 50% of the General Beer Duty £19.08 per hectolitre (under 7.5 % abv)
I don’t know what else happens or what else I need to do if I want to sell from home?
I think the answers to this will make a great thread for the whole forum.
Thanks in advance.
G

 

[Sadfield]

Depends on how detailed any answers to the OP is. But you're right it is a regular question

I wonder if those in a position to give a detailed answer are too busy with other paperwork to do so?

Step 1 should probably be - Speak to potential customers about volumes and prices.

 

[Druncan]

Hi @Garry247 To stop re-hashing, it may be better to just search the forum for 'HMRC' - read it all, then start asking.
There is a lot of valuable info on here, just get digging m8

 

[Druncan]

I wonder if those in a position to give a detailed answer are too busy with other paperwork to do so?

Aye m8, HMRC just changed the EX46 beer report to online and it doesn't work. Nightmare.

 

[simon12]

This is a thread worth reading through https://www.thehomebrewforum.co.uk/threads/hmrc-registration-not-so-daft-an-idea-after-all.10910/

 

[thewelshwizard1]

Hi,
I’m looking into selling beer in the UK on a very small scale as a kind of paid hobby and have seen there are a few things that need to happen.
1. Get in touch with HM Revenue & Customs for duty purposes.
2. Get in touch with local environmental health organisation (EHO)
I know i will need to pay a Beer Duty:
Duty: Brewers with an annual production of not more than 60,000 hectolitres may be eligible for a reduced rate of duty (This is currently 50% of the General Beer Duty £19.08 per hectolitre (under 7.5 % abv)
I don’t know what else happens or what else I need to do if I want to sell from home?
I think the answers to this will make a great thread for the whole forum.
Thanks in advance.
G

Don't tell them
..
Hahaha

 

[Craig_teesside]

Open a pub

 

[lancon]

HMRC will only allow you to make the beer. You can't sell the beer to the general public without a licence for which you would have to apply to the local authority . You can sell it to pubs/off licences or anywhere that has a suitable licence, farmers markets &etc. You will also need AWRS.

 

[Northern_Brewer]

Hi,
I’m looking into selling beer in the UK on a very small scale as a kind of paid hobby and have seen there are a few things that need to happen.
1. Get in touch with HM Revenue & Customs for duty purposes.
2. Get in touch with local environmental health organisation (EHO)

Environmental Health Officer - part of the local council. It's their job to ensure that your premises is a safe place to produce food, which can mean they insist on all sorts of detail like ensuring your extractor fans manage an airspeed of X metres per second, that doors are tight enough fits that rats can't get in, all that kind of thing. I'm not sure how tough they would be in the case of a nanobrewery, but they would probably be the first people to talk to as they can require lots of slow, expensive building work that becomes your limiting factor.

There's all sorts of non-obvious things to sort out, like getting permission from your water company to put commercial organic effluent (which is what beer waste is) down the drain.

If you're seriously looking at this then I strongly recommend you get Ted Bruning's Microbrewer's Handbook - make sure it's the latest, 7th edition which came out in July :
https://www.bookdepository.com/Microbrewers-Handbook-2019-Ted-Bruning/9781999840815

I'd make the observation that a couple of garage "hobby" nano-breweries opened round us in 2016 or so, and whilst they made good beer, all had given up by 2019, apart from one which had graduated onto bigger kit. The trouble is the fixed costs and labour are pretty similar whether you're making half a barrel or 10 barrels, but you obviously make 20x the revenue from the latter (if you can sell it).

The two models that seem to work are 2-3bbls mostly sold through your own tap, or 8+bbls into the free trade - as long as your beer is at least in the top 40-50% of what's out there. You might also consider this article, which suggests that breweries making less than 5000 litres per week (2500hl/year) are almost all losing money. Yes, the part-time model can help, but you still have substantial fixed costs to defray, and a relentless need to sell, to chase payment, to deliver when other people want, etc - it's tough.

 

[JebKerman]

Hi,
I’m looking into selling beer in the UK on a very small scale as a kind of paid hobby and have seen there are a few things that need to happen.
1. Get in touch with HM Revenue & Customs for duty purposes.
2. Get in touch with local environmental health organisation (EHO)
I know i will need to pay a Beer Duty:
Duty: Brewers with an annual production of not more than 60,000 hectolitres may be eligible for a reduced rate of duty (This is currently 50% of the General Beer Duty £19.08 per hectolitre (under 7.5 % abv)
I don’t know what else happens or what else I need to do if I want to sell from home?
I think the answers to this will make a great thread for the whole forum.
Thanks in advance.
G

Hi Garry

I've recently gone through this process...

In addition to the above registering with HMRC, you'll need your premises checked by lour local authority EHO, possibly planning officeer as well depending on the scale of operation.

You'll also need a food hygiene certificate, and hold a personal licence. If you want to sell from home, you'll need a premises licence as well, which may need a planning officer visit.

You will also need public liability insurance as a food/drinks trader, and occasional licences if you plan on selling at farmers markets etc.

If you want to sell to pubs etc, you'll also need to be registered through the HMRC AWRS process, which is in Excise notice 2002, so you will need a full business plan, due diligence and financial projections available to you for them to be able to process this (It also takes about 6 weeks to get this)

There are loads of hoops that you will need to jump through, but I have found that HMRC have been great to deal with any queries, and the local licencing team will become very useful to you.

Good luck

 

[JebKerman]

Aye m8, HMRC just changed the EX46 beer report to online and it doesn't work. Nightmare.

EX46 is working fine for me.

I think it depends on the browser

 

[Druncan]

I also had to get a planning change of use from commercial guesthouse to Part domestic part microbrewery with office/studio.

@JebKerman I was told it is due to our gateway account being set up for PAYE for staff. HMRC advise it is a known fault,,,, However I am adding AWRS as I'm going to supply hotels and outside events, that then allows me to do EX46 online as the paper system ends next month.

 

[lancon]

I'd make the observation that a couple of garage "hobby" nano-breweries opened round us in 2016 or so, and whilst they made good beer, all had given up by 2019, apart from one which had graduated onto bigger kit. The trouble is the fixed costs and labour are pretty similar whether you're making half a barrel or 10 barrels, but you obviously make 20x the revenue from the latter (if you can sell it).

The two models that seem to work are 2-3bbls mostly sold through your own tap, or 8+bbls into the free trade - as long as your beer is at least in the top 40-50% of what's out there. You might also consider this article, which suggests that breweries making less than 5000 litres per week (2500hl/year) are almost all losing money. Yes, the part-time model can help, but you still have substantial fixed costs to defray, and a relentless need to sell, to chase payment, to deliver when other people want, etc - it's tough.

I think it does depend on a few points, first whether it is money making fun or 'commercial', if the latter then you spend most of your time selling the beer and little time making it, which is good for some but not my idea of fun. Secondly if it s small scale (1/2 - 1 bbl) then doing it from your house will incur little extra costs. One of the main costs that is crippling is premises/insurance &etc. Probably dont need to get planning involved unless neighbours are not on side.

 

[JebKerman]

I also had to get a planning change of use from commercial guesthouse to Part domestic part microbrewery with office/studio.

@JebKerman I was told it is due to our gateway account being set up for PAYE for staff. HMRC advise it is a known fault,,,, However I am adding AWRS as I'm going to supply hotels and outside events, that then allows me to do EX46 online as the paper system ends next month.

Good luck with it... Didn't realise PAYE had an impact on the EX46

 

[thewelshwizard1]

Another reason why we brew our own....Tax!!!!!

 

[Northern_Brewer]

Probably dont need to get planning involved unless neighbours are not on side.

But registering as a food business is pretty much non-negotiable, which means that Environmental Health will be all over you.

 

[lancon]

Environmental Health are there to help not hinder, they're practical , never had a problem. If you're doing it in the kitchen then that should be enough, it's the bottling or casking, that they are more concerned with.

 

[johncrobinson]

Its great if ones hobby can pay for itself.Brewing is not the easiest choice.Food/alcohol regs see to that.
Might be better to start off as a "Full-on proper all-out buisiness" from day one.

 

[Northern_Brewer]

Environmental Health are there to help not hinder, they're practical , never had a problem.

They obviously vary. My experience is that 90% of the time they are practical, even helpful - but they can get hung up on random things that once they've decided are a problem, then they require a solution no matter what the practicalities.

 

[evenseven]

I have no experience with selling beer regs, but I have setup a limited company which is very straight forward, as is submitting annual tax etc. Bank accounts are easy to setup, I would recommend, mobile banks like Tide, or starling no monthly fees ever. HMRC have so much info and support on their site, it would be the best place to start. I have a full time job, but do a web design/development/digital marketing on the side. If you need any advice re: setting up websites, what tools you can use to sell, I have worked in e-commerce since 2005, so I know my way around.