Guidance

Soft Drinks Industry Levy returns and records (notice 2)

What you need to include in your Soft Drinks Industry Levy return, how to correct an error in a previous return and what records to keep.

• From: HM Revenue & Customs
• Published: 3 April 2018
• Last updated: 13 December 2021 — See all updates

If you’re a producer or packager of drinks that are liable for the Soft Drinks Industry Levy, or you need to report drinks that have been brought into the UK, you’ll need to send a return to HMRC every quarter.

The returns are for fixed reporting periods ending June, September, December and March. You must submit the return and pay any levy due within 30 days of the end of the reporting period.

If you do not submit the return in time, HMRC can charge you an estimate of what you owe.

If you’re registered for the levy and have nothing to report for a period, you should submit a nil return, unless you’re only registered as a small producer.

How to submit your return

This section has force of law under regulation 22 of the Soft Drinks Industry Levy Regulations 2018.

You need to be registered for the levy before you can submit a return.

Returns can only be submitted when the accounting period you’re reporting for is over.

You must submit returns through the online service.

What you need to include on your return

This section has force of law under regulation 22 of the Soft Drinks Industry Levy Regulations 2018.

On your return, you must include how many litres of liable drinks you need to report. You’ll need to report drinks that are liable for each levy band separately on your return.

You must include how many litres of liable drinks were:

• packaged for yourself or someone else (not including amounts packaged for small producers)
• packaged for each small producer, including their Soft Drinks Industry Levy registration number
• brought into the UK (not including those produced by small producers)
• brought into the UK from small producers

If you’re reporting diluted soft drinks, you must report the amount of ready-to-drink litres made when it’s diluted according to the dilution ratio stated on the packaging.

You must also include how many litres of liable drinks you’ve paid the levy on, or that you’re reporting in the current return, and are claiming a credit for because they were:

• exported, or are expected to be exported
• lost or destroyed

Correct an error in a previous return

If you submit a return that includes incorrect information, you should correct it using the online service.

Once in the service, select ‘Make a change’ in the ‘Manage your account’ section and follow the instructions.

If you did not use the online service to submit your return, you can contact HMRC about your error.

Supporting information

You do not need to send any additional documents when telling HMRC about an error you have made. HMRC will ask for it if supporting evidence is needed.

The records you need to keep for any reporting period are the same.

However, when you want to correct an error in a previous return, you also need to keep a separate record of:

• the date you found the error
• the quarter when the error happened
• the reason for the error
• any related documents
• whether the error was in relation to an export credit, a credit for lost or destroyed goods, or another type of error (if it is another type you will need to explain more about this)

If you owe more

If your correction shows you have not paid enough, you will need to pay the difference between what you originally declared and the correct figure. You should do this when you receive a notice of payment.

You will be charged interest on what you owe and this will continue to be calculated until you pay the amount due in full.

If you do not pay by the due date you may also receive an additional late payment penalty.

Penalties for inaccuracies

You may be charged a penalty if you give HMRC a return or other document that contains an inaccuracy and the inaccuracy:

• results in tax being unpaid, understated or over-claimed
• was careless, deliberate or deliberate and concealed

The penalty will be calculated as a percentage of the ‘potential lost revenue’. This is the additional amount of levy that is due as a result of correcting the inaccuracy. When working out the amount of the penalty we will also consider what caused the inaccuracy and whether you have disclosed the inaccuracy before we discovered it.

You will not be charged a penalty if you took reasonable care.

You can find more information about inaccuracy penalties in factsheet Compliance checks for penalties of inaccuracies in returns or documents(CC/FS7a).

If you paid too much

If after making your correction you find that you paid too much levy, you can either:

• take the difference as a credit towards your liability for the next quarter
• apply for a repayment, as long as your correction was not to a credit for drinks exported, lost or destroyed

You cannot apply for repayment of any more than the net amount of levy you paid in the quarter you made the error.

If the correction was to a credit for drinks that were exported, lost or destroyed, no repayment will be made. This will be held on your account and any future liability will be offset against this amount.

If you ask for a credit to be repaid, HMRC may wish to discuss this with you before deciding whether to make a repayment and will contact you if necessary.

If you have any unpaid liabilities for the Soft Drinks Industry Levy or any other tax, HMRC may offset the repayment against those liabilities.

HMRC will not normally make a repayment if the amount that you are claiming has actually been paid by your customer and you are not planning to pass the refund back to them. However, if a repayment is made HMRC may ask you to sign an undertaking that you will reimburse your customer.

Records you need to keep

For each reporting period, you must get and keep records of:

• the amount of litres of liable drinks in each levy band
• the amount of levy you need to pay
• liable drinks that you need to report but you’ll claim a levy credit for, and how any levy credits were calculated
• any adjustments or corrections made for previous returns, including which reporting period the return was for and the amount you need to pay as a result

For each delivery of liable drinks to all premises where you store liable drinks (including registered warehouses), you must get and keep records that show:

• whether the premises have been nominated as a registered warehouse with HMRC
• the amount delivered, in litres
• the date of delivery
• the date that they were removed from the premises
• details of who:
  • made the delivery
  • transported the drinks from the premises

If you’re a packager of liable drinks, you must get and keep records for each reporting period of:

• how many litres of liable drinks were produced by small producers
• the amount of litres of liable drinks that were first either:
  • packaged and removed from your premises
  • made available for sale (or free of charge)

You must keep all records for 6 years, starting from the last day of the Soft Drinks Industry Levy reporting period that the records are for.

Published 3 April 2018
Last updated 13 December 2021 + show all updates

1. 13 December 2021

   Information has been added about penalties for inaccuracies in a return.

2. 1 October 2018

   A new section has been added giving information about how to correct an error in a previous return.

3. 11 September 2018

   The section on how to correct an error on a return already sent, has been removed as the information was out of date.

4. 1 July 2018

   This guide has been updated with a link to the Soft Drinks Industry Levy returns service.

5. 30 May 2018

   The section headed 'Reference number' has been added and bank details have been added to the section headed 'ways to pay'.

6. 3 April 2018

   First published.