Operators warned over cocktail home delivery without license
Law firm TLT says that HMRC can impose penalties if businesses are pre-mixing cocktails without a compounder’s licence.
The licence is necessary even if a business is mixing the cocktails within an on-licensed premises, so long as the sale is for customers elsewhere.
According to HMRC, a business is a compounder if it “combines or mix plain spirits or previously compounded spirits with any other substance, except water, so as to distinctly alter the character or flavour of the plain spirits or compounded spirits, producing a new compounded spirit.”
There is no charge for applying for the license, so subject to complying with the requirements for producing the products in accordance with the law, it is an administrative process only.
The warning comes as bars, restaurants, pubs and drink brands are increasingly offering cocktail home deliveries as a way of continuing to trade during the pandemic.
A number of new pre-mixed cocktail brands have also launched over the last year, to cater for the homebound consumer.
HMRC is urging operators that have not applied for a licence when they should have done to let it know without delay.
It also confirmed that operators have the right to appeal in the event they are served with a penalty.
“A lot of operators don’t realise they need a compounder’s licence to legally offer this kind of service,” says TLT legal director Piers Warne.
“It has largely flown under the radar, but with the recent rise in home deliveries of alcohol and specialist cocktail makers looking to supply their creations directly to consumers at home, the genie is well and truly out of the bottle. Remember this does not apply to spirits sold unmixed for mixing at home, only pre-mixed cocktails.”
The compounder’s licence also applies in Scotland but in addition to the HMRC permissions operators that are offering home delivery of cocktails, or any alcohol, must declare this within premises or occasional licence under the Licensing (Scotland) Act 2005 to avoid any issues with the licensing board.
Scottish operators must also observe additional rules for the home delivery of alcohol, including keeping records and following age verification processes.
