Buying and selling wine in bond has many other benefits than simply being stored in perfect conditions. This brief guide outlines some of these advantages.
What does ‘wine in bond’ mean?
Wines that are stored in bond are wines which have not had Duty or VAT paid on them yet. For this reason, they are required to be stored in bonded warehouses approved by the HM Revenues and Customs (HMRC).
What are the advantages of buying wine in bond?
Value Added Tax (VAT) and UK excise duty payments on the wine are deferred, as they are essentially stored “in transit”. In fact, wines stored in bond may change hands multiple times within a bonded warehouse without ever having to pay VAT or duty. They can also be moved from bond to bond as long as the company transferring the wines has a movement guarantee. If you’re looking to have the wine that is stored in bond delivered later on, the VAT cost incurred is payable on the original sale price of the wine, not current market value.
What are the advantages of selling wine in bond?
If you’re looking to sell wine in bond, you will never have to pay the duty or VAT charges, as these tax charges are only incurred once the wines are removed from bond. In addition to this, wine merchants and brokers will usually quote you the same prices, whether or not the VAT or duty charges have been paid. Therefore if you decide to sell your wine in bond, you will save the equivalent VAT and duty charges.
Why use a government licensed bonded warehouse?
Storing your wine in an HMRC-approved bonded warehouses is the best way to ensure the traceability and provenance of your wines. Bonded warehouses like the London City Bond or Octavian Vaults also provide the optimum storage conditions for fine wines including tight regulation of temperature, humidity and other microclimatic factors. Furthermore, certain merchants will pay a premium for wines in bond, as they ensure getting the best prices for their wine. We have provided a list below of other HMRC-approved bonded warehouses in U.K. to store your fine wine investments.
How can I find a bonded warehouse for storing wine?
There are many bonded warehouses around the UK, and most provide similar services to one another. To help our clients find a bonded warehouse, we have collated a useful resource outlining the contact details of these warehouses. View our Bonded Warehouse List.
