Section 17 — duty on domestic consumption and vine leasing
Information about grower’s domestic consumption relief and vine leasing.
If you are an approved alcoholic products producer, any alcoholic product you produce for your own domestic consumption will be liable to Alcohol Duty.
Wine, other fermented product and cider made from fruit (including honey from bees) grown by a grower can be sent without payment of duty from approved premises for the domestic consumption of the grower of the ingredients and by the employees of the grower.
The term ‘grower’ refers to a person who owns or leases vines or trees for which they are responsible for the cultivation, nurturing and harvesting. This does not need to be done personally as the grower may contract others to carry out the work for them, but they are responsible for the supervision of any contracted work.
The term ‘domestic consumption’ means consumption or use by the:
- grower and the growers family or, in the case of a limited or public company, its directors
- grower’s employees and guests
Visitors can be considered as guests. You do not pay duty as long as:
- no charge is made for admission to the premises
- no charge is made for the wine, other fermented product or cider
- the wine, other fermented product or cider is supplied by the glass and not in bottles or other take-away packaging
Drink consumed may be taken from your domestic consumption allowance.
Relief entitlement is based on the quantity of wine or other fermented product produced in the preceding calendar year (January to December) and must not exceed the actual amount produced.
If no wine or other fermented product is produced in the preceding calendar year there is no entitlement to domestic consumption. No part of your entitlement can be carried forward from one year to the next.
If you want to claim this relief, you must record your domestic consumption calculation in your business records before you remove your entitlement. You’ll be liable to pay duty on any quantity over claimed.
The entitlement is based on the quantity of cider produced in the preceding calendar year (January to December) and must not exceed the actual quantity produced. So, if no cider is produced in the preceding calendar year there is no entitlement to domestic consumption. No part of your entitlement can be carried forward from one year to the next.
If you wish to claim this relief, you must record the details in your business records stating how much cider is to be used for each purpose. There is no upper limit on the amount of relief you can claim. However, you must be able to satisfy us that your claim is not excessive. You’ll be liable to pay duty on any quantity overclaimed.
Vine leasing is when the owner of a vineyard leases a number of vines (or rows of vines) to an individual or group of individuals in order that they (the lessees) may receive the wine produced from the grapes of their leased vines.
Lessees receiving duty free wine
Lessees can receive wine duty free if it is for their own domestic use and there are no commercial considerations such as sale promotion agreements and so on.
You may be asked by our officer to produce contracts or agreements for inspection.
Rules for a lessee deemed to be a grower
The lessee may only receive wine produced from their own grapes.
They must take responsibility for all the work on their vines such as the cultivation, nurturing, harvesting and present the grapes from only their own vines for vinification by a winemaker.
This does not need to be done personally. The lessee or grower may contract others to carry out the work for them, but they are responsible for the supervision of any contracted work.
Rules for the vineyard owner to allow lessees to receive wine duty free
Under this scheme, the vineyard owner must:
- not attend to the cultivation, nurturing or harvesting of the leased vines unless they or their employees are separately contracted to do so by the lessee
- not supplement the harvest of any leased vines from any other source
- allow the lessee to take his grapes elsewhere for making into wine (vinification)
- maintain records of each lessee and the quantity of grapes presented for vinification with relatives dates and times
Although the vineyard owner may make into wine the grapes from more than one lessee at the same time, each lessee must receive on that proportion of wine which relates to their grapes.
If these rules are not observed, the wine produced will be liable to excise duty.