For a considerable time, investing in whisky has been a favoured option for those knowledgeable about our industry. This is because a cask of fine whisky can yield remarkable returns on investment. On average, we observe that a cask of fine whisky delivers an annual return of approximately 12%.
Typically, first-time buyers can acquire casks for around £10,000. Those venturing into branded casks will allocate this sum towards casks that are typically 8 to 10 years old. While the recommended minimum maturation period for whisky is around 5 years, some experts advise waiting for at least 7 years. As time passes, the whisky matures, becoming smoother and more desirable, resulting in potential profits that can continue to grow well beyond the suggested 7 years of ownership.
Why Investing in a Fine Whisky Cask Is a Secure Choice
Many investors in cask whisky are drawn to it because of the tax advantages it offers. For instance, VAT is suspended when whisky is in a cask, whereas it becomes a significant tax liability when bottled. Scotch whisky currently carries a 70% tax rate, but because whisky in a cask evaporates slowly, it is categorised as a "wasting asset." The loss due to evaporation is minimal, allowing this investment to be exempt from capital gains tax. In Scotland, it is even a common practice to pass a cask down as an inheritance for its tax benefits.
In fact, we have witnessed that the top 100 superior-grade whisky brands have appreciated by over 500% in the past decade!
Collaborating with UKV
UKV International AG is a brokerage specialising in the trade of wine and whisky. Their services assist individuals looking to invest in the whisky market by facilitating the acquisition of some of the rarest whisky, wine, and champagne.
By seeking assistance from UKV, you can locate available casks for purchase and utilise their brokerage service when you are ready to realise returns from your investment. Currently, UKV has assisted over 500 clients in acquiring premium casks, a service they consistently excel at.
Furthermore, their involvement in the brokerage service enables them to aid in selling the cask back to either the distillery or bottling it for sale. Through their service, you can receive genuine advice tailored to your investment goals.
UKV International's Perspective
Those affiliated with UKV openly discuss why they believe whisky is such a crucial asset in an investor's portfolio.
Alex Presley, the luxury asset consultant for UKV, notes that whisky "is a bona fide collector's item – and a premium asset capable of providing the sort of return for your money that banks and building societies cannot offer."
Oliver O'Donovan, the European sales director at UKV, adds, "Whisky is a tax-free return and a better alternative investment than a classic car, for example, that can be very capital intensive and is less easily traded. We're also likely to see a surge in demand because import duties are currently being dropped all over the world."
Our Concluding Thoughts
If you seek a tax-free return on your investment, we highly recommend investing in your own cask. You will discover that reselling your cask is far more straightforward and less volatile than in other industries. When you engage a company like UKV, you benefit from added security against theft and damage. Even if a distillery faces bankruptcy, your investment remains safeguarded, as it is stored in a government-approved bonded warehouse.
UKV International AG's core focus revolves around acquiring, supplying, and selling bonded whisky. We provide for consumption and investment according to our clients' needs, and we offer a brokerage service for those wishing to sell investment-grade whiskey held in UK-regulated bond.
We are here to guide you in selecting which whisky to invest in and to ensure your cask is stored correctly and securely, whether for drinking, gifting, or selling.
To learn more, please contact us here.