Cask whisky is typically subject to both Import Tax and VAT but, if the whisky is held under bond at an HMRC-regulated warehouse, the liability for these taxes is suspended. Providing the whisky remains under bond, the owner doesn’t become liable to pay either Import Tax or VAT on it. Furthermore, the whisky does not become liable for Import Tax or VAT if it is sold in bond, as the liability remains suspended.
If you decide to remove your cask whisky collection from an HMRC-regulated warehouse, Import Tax and VAT will be charged at the rate set by the HMRC at the time of removal. Similarly, if cask whisky is bottled, you will need to pay Import Tax, VAT, and relevant bottling charges.
Tax rates, regulations, and liabilities change on a regular basis, so it’s always advisable to seek advice from a specialist tax advisor before expanding your portfolio. While cask whisky collections do offer certain tax benefits, understanding how whisky taxation works is essential for any collector and our in-house whisky experts are happy to answer any questions you may have.