How UK Wine Duty and In-Bond Buying Work

Wine duty is an excise tax charged by HMRC on all wine sold for consumption in the United Kingdom. It is paid on top of the wine itself, and VAT (20%) is then charged on the combined total of the wine price plus the duty. For a typical bottle of fine wine, duty and VAT together can add a significant premium to the underlying cost.

Since August 2023, UK wine duty has been calculated on an ABV basis - the higher the alcohol content, the higher the duty. Still wines between 11.5% and 14.5% ABV benefit from a flat transitional rate, but wines outside that band pay proportionally more or less. Rates are reviewed at each Budget and have generally risen year on year.

For a standard 75cl bottle of still wine at 13.5% ABV, the combined cost of duty and VAT typically adds between £3 and £4 to the price. On a £10 retail bottle, that means roughly a third of what you pay goes to tax. On a £200 bottle of classified Bordeaux, the same fixed duty applies - which is why duty matters less as a percentage on fine wine, but the absolute saving from deferring it still compounds over a cellar of dozens or hundreds of bottles.

Sparkling wines attract a higher rate than still wines at the same ABV. Fortified wines (port, sherry) are taxed at a higher band again. Exact rates change at each fiscal event - HMRC publishes the current schedule in Notice 162.

A wine is “in bond” when it is held in an HMRC-registered bonded warehouse and neither excise duty nor VAT have been paid on it yet. The tax liability exists but is suspended for as long as the wine remains in bond. The moment it leaves the warehouse for personal delivery or consumption, duty and VAT become payable.

This is not a loophole - it is the standard mechanism by which wine merchants, auction houses, and collectors store stock in the UK. Bonded warehouses are licensed and inspected by HMRC, and every movement of wine in and out is tracked. The system exists because wine is often held for years or decades before being drunk, and collecting tax upfront on stock that may never be consumed in the UK (it could be re-exported) would be inefficient for everyone.

A bonded warehouse is a secure, climate-controlled facility approved by HMRC to store goods on which duty has not yet been paid. In the wine trade, the major bonded warehouses in the UK include London City Bond (LCB), Octavian Vaults in Wiltshire (underground former Ministry of Defence bunkers), and several smaller specialist facilities. Most fine-wine merchants do not store wine on their own premises - they hold it at one of these warehouses under their bond account, and transfer ownership electronically when a sale is made.

Storage charges vary but typically run between £10 and £15 per case per year, including insurance. For wine worth hundreds or thousands of pounds per case, this is a small cost relative to the tax saving and the assurance of professional cellar conditions.

When you see a price quoted “in bond” (often abbreviated IB), it excludes duty and VAT. A “duty paid” (DP) price includes both. The difference is always the same fixed amount for a given wine format and ABV, regardless of the wine’s value. For a standard 75cl bottle of 13.5% still wine, the uplift from IB to DP is currently around £3.50 - £4.00 per bottle, or roughly £42 - £48 per case of twelve.

Fine-wine merchants in the UK - Berry Bros. & Rudd, Justerini & Brooks, Corney & Barrow, Lay & Wheeler, and others - generally quote in-bond prices as standard. Retail-focused merchants and supermarkets quote duty-paid. When comparing prices across merchants, it is important to check which basis is being used.

There are three practical reasons to buy and hold wine in bond rather than paying duty upfront.

Deferred tax. Duty and VAT are only payable when you withdraw the wine. If you are building a cellar over years, this defers a material cash outlay. And if duty rates rise (as they have historically), wine already in bond is grandfathered at the rate applicable when it is eventually withdrawn - not the rate when it was purchased.

Professional storage. Wine in bond is stored in conditions specifically designed for long-term ageing - constant temperature, humidity control, darkness, and no vibration. Home storage, even with a dedicated wine fridge, rarely matches this. For wines intended to mature over a decade or more, provenance and storage conditions directly affect value.

Resale and export. Wine held in bond can be sold to another buyer or exported without duty ever being paid. This makes the secondary market (merchant buy-back, auction, private sale) significantly more liquid. A buyer in Hong Kong, for example, pays no UK duty at all - the wine ships directly from the bonded warehouse. If you had already paid duty, reclaiming it on export is possible but bureaucratic.

En primeur (also called wine futures) is the practice of buying wine while it is still in barrel, typically 18 - 24 months before it is bottled and delivered. It is most associated with Bordeaux, but Burgundy, the Rhône, and some other regions also offer en primeur campaigns.

En primeur wine is a subset of the in-bond market. When the wine is eventually shipped to the UK and arrives in a bonded warehouse, it sits in bond like any other wine. The distinction is timing: en primeur is bought before delivery; in bond is the tax status once it arrives. A wine can be in bond without ever having been sold en primeur - back-vintage stock from merchants, auction purchases, and private reserves all sit in bond too.

cellrd searches live in-bond prices across 12+ UK fine-wine merchants in a single query. Every price shown is in bond and comparable like-for-like. Instead of checking Berry Bros., then Lay & Wheeler, then Justerini & Brooks individually, you describe what you are looking for - a region, a vintage, a budget, a style - and cellrd returns what is available right now, with critic scores and price context.

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