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You already track production records, batch logs and inventory. If you sell to pubs, shops or distributors, HMRC also expects you to hold AWRS approval. If you buy alcohol to resell, HMRC expects you to check that your suppliers hold it too.
AWRS isn’t a form you file once and forget. It’s an ongoing compliance programme, and it works in two directions:
- As a seller, you need HMRC approval before you trade wholesale.
- As a buyer, you need to confirm that every wholesaler you buy from is approved.
Many distilleries play both roles. This guide covers each one.
Main Takeaways
- If you sell alcohol to other businesses for resale, you need AWRS approval. Apply at least 45 days before your first wholesale delivery.
- Your first regular trade account, even a single pub, brings you into scope.
- Selling wholesale without approval is the main risk: a penalty of up to £10,000, seized stock and possible criminal prosecution.
- If you buy alcohol to resell, you must check your supplier’s AWRS number and keep a record. Buyers who skip this can face penalties too.
SEE HOW EXCISE REPORTING WORKS IN PRACTICE
AWRS record-keeping overlaps directly with excise reporting. This piece breaks down what HMRC expects and where distilleries get tripped up.
READ THE EXCISE REPORTING GUIDE
Part 1: If You Sell Alcohol Wholesale
Who Needs AWRS Approval
AWRS is an HMRC regime designed to combat alcohol fraud. Your business needs approval if all three of these apply:
- You have an establishment in the UK.
- You sell alcohol at or after the excise duty point.
- You sell to other businesses for onward sale or supply.
If you sell only direct to consumers, you’re out of scope. That includes a distillery that sells only through its own taproom or shop. Once you start supplying pubs, shops or distributors, you’re in.
HMRC requires you to apply at least 45 days before you start trading wholesale. Trading wholesale without approval can mean a penalty, seized stock and possible prosecution.
| Business Type | AWRS Approval Required? | Why |
|---|---|---|
| Distillery selling to pubs, shops or distributors | Yes | B2B sales for resale |
| Microbrewery selling kegs to bars | Yes | B2B sales for resale |
| Wine importer selling to retailers | Yes | B2B sales for resale |
| Retailer making regular sales to other shops | Yes | Regular B2B resale |
| Distillery or brewery selling only through its own taproom | No | No sales for resale |
| Retailer making an occasional, unplanned sale to a local business | No | Incidental, not regular wholesale |
| Corporate group moving stock between its own entities | No | Intra-group sales are excluded |
| Cider producer at nil duty under Small Producer Relief | No | Exempt under Small Producer Relief |
Watch the Transition Point
The risk sits in the transition. A taproom-only distillery that signs its first restaurant account has just made a B2B sale for resale. That puts it in scope. The one-off exemption is narrow, and HMRC frames it around retailers, so don’t rely on it for a new trade account. Plan your AWRS application before you sign the deal.
The Fit and Proper Test
Before HMRC approves you, it checks whether the key people in your business are “fit and proper.” Under Excise Notice 2002 (part 6.10), it looks at:
- Criminal history of partners, directors and key persons
- Connections to non-compliant or fraudulent businesses
- Outstanding HMRC debts
- The quality of your due diligence procedures
- Overall business health and structure
HMRC may visit your site before approving you. A visit can push processing past the standard 45 days, so have your records and procedures ready before you apply.
How to Apply
Apply online through Government Gateway. Registration is free. You’ll need:
- Business structure and ownership details
- Identities of key staff
- Premises addresses
- A description of your wholesale activities
- Your due diligence procedures
HMRC usually decides new applications within 45 calendar days. Once you’re approved, you get a Unique Reference Number (URN). Put it on every wholesale invoice. Your customers use it to confirm you’re approved.
Staying Compliant After Approval
After approval, you have three ongoing duties:
- Keep records for six years: purchase records, sales invoices showing your URN, and stock records that reconcile against purchases and sales.
- Report changes within 14 days: tell HMRC about changes to key personnel, contact details, trading names or VAT numbers.
- Report premises changes immediately: if you stop using a trading premises, or stop wholesaling altogether, tell HMRC straight away.
KEEP PURCHASE RECORDS AND SUPPLIER LOGS IN ONE PLACE
DISTILL x 5® captures the purchase data, stock movements and supplier details HMRC asks for. See what audit-ready compliance looks like inside the platform.
Part 2: If You Buy Alcohol for Resale
This part applies even if you don’t need AWRS approval yourself. Say your distillery shop stocks other producers’ gins, or you buy spirit to blend and resell. You’re a trade buyer, and you need to check your suppliers.
Verify Every Supplier
Before you place an order, check the supplier’s URN with HMRC’s AWRS checker. Then:
- Log each check with the date, the URN and the result.
- Re-check regularly, not just when you first take on a supplier. HMRC doesn’t set a frequency, but quarterly is sound practice.
- Keep the logs with your purchase records.
These logs are your evidence of due diligence. If HMRC reviews your supply chain, they protect you.
What Happens If You Get It Wrong
The main risk sits with the seller. Buyer checks are a second safeguard.
If you sell wholesale without approval:
- HMRC can charge a penalty of up to £10,000. Deliberate breaches cost more, and disclosing the problem to HMRC can reduce the amount.
- HMRC can seize your stock, even if the duty has been paid.
- Serious cases, including continuing to trade after HMRC refuses approval, can be prosecuted as a criminal offence.
If you’re approved but miss a requirement:
- Other breaches, such as a missing URN on an invoice or a late change notification, can also lead to penalties.
If you buy from an unapproved wholesaler:
- HMRC can charge a penalty, which scales with your behaviour. There’s no penalty if you had a reasonable excuse for a non-deliberate failure, and a clear record of your checks shows that.
- HMRC can seize the stock, and serious cases can be prosecuted.
Treat AWRS compliance as a routine, not a scramble. Capture records as you trade. Log a check each time you take on or re-check a supplier. Then an audit letter is a formality.
Start Managing AWRS Compliance with DISTILL x 5
Dx5 captures purchase records, batch data, stock movements and supplier verification logs as you produce and trade. Every location follows the same compliance procedures. When HMRC asks, your due diligence evidence already exists in the system, so a routine inquiry doesn’t turn into a week of digging through spreadsheets.
FAQs About the Alcohol Wholesaler Registration Scheme
No. If every sale goes direct to consumers, you’re out of scope. You need approval once you start regular sales to pubs, restaurants or retailers. Apply at least 45 days before the first delivery.
What happens if I sell wholesale without AWRS approval?
HMRC can charge a penalty of up to £10,000 and seize your stock. Deliberate breaches cost more, and serious cases can be prosecuted. If you’ve started trade sales without approval, apply straight away and tell HMRC. Disclosing the problem can reduce the penalty.
Yes. The check applies to anyone who buys alcohol to resell. That includes a distillery shop that stocks other brands.
HMRC can charge a penalty and seize the stock. The amount depends on whether the breach was deliberate. If you had a reasonable excuse, such as a documented check, you may avoid a penalty. Deliberate cases can be prosecuted.
HMRC says to check regularly but doesn’t set a frequency. Check at the first order, then re-check quarterly. Record the date, the URN and the result. Keep these logs with your purchase records for six years.
Yes. Dx5 captures purchase records, supplier details, stock movements and batch data as you trade. You can log supplier URN checks in the system and produce audit-ready records without rebuilding them from spreadsheets.
Disclaimer: This article is general information only. It doesn’t constitute legal, tax or regulatory advice, and it doesn’t replace HMRC’s official guidance. It reflects HMRC guidance as of September 2026, including Excise Notice 2002 and HMRC’s AWRS manual.
SEE HOW EXCISE REPORTING WORKS IN PRACTICE
AWRS record-keeping overlaps directly with excise reporting. This piece breaks down what HMRC expects and where distilleries get tripped up.
KEEP PURCHASE RECORDS AND SUPPLIER LOGS IN ONE PLACE
DISTILL x 5® captures the purchase data, stock movements, and supplier details HMRC asks for. See what audit-ready compliance looks like inside the platform.
