Excise due diligence.
Changes to the conditions of HMRC excise registration / approval(s)

A new condition, relating to the registration or approval with HMRC as an excise trader, will take effect from 1st November 2014.
Alcohol duty fraud is a serious problem that harms not only the UK taxpayer - depriving the UK of approximately £1bn per annum in public revenue - but also legitimate businesses, communities and the wider economy. HMRC has consulted extensively on measures to tackle alcohol fraud over recent years and in its Autumn Statement 2013 the Government announced the introduction of "due diligence" requirements for excise businesses. These are aimed at ensuring excise businesses approved by HMRC undertake reasonable and effective due diligence when entering trading relationships in the alcohol supply-chain.
Many businesses already take great care to avoid supplying to, or sourcing from, the criminal enterprises behind alcohol fraud. This measure will require all registered excise businesses that deal in alcohol products to put in place adequate controls and checks to protect their supply-chains against the risk of penetration by fraud. Without effective safeguards in place, there are considerable risks to all businesses along alcohol supply chains of becoming implicated in activities that may lead to fraud, or receiving goods of unknown provenance on which duty may also have been evaded.
From 1st November 2014, it will be a condition of all approvals for the Trader to:
i) Objectively assess the risks of alcohol duty fraud within the supply chains;
ii) Have in place reasonable and proportionate checks in your day to day trading to identify transactions that may lead to fraud or involve goods on which duty may have been evaded;
iii) Have procedures in place to take timely and effective mitigating action where a risk of fraud is identified; and
iv) Document the checks you intend to carry out and have appropriate management governance in place to ensure that these are, and continue to be, carried out as intended.

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