Worthwhile visit to my local brewery this afternoon

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moto748

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It's only a small concern, their website only mentions 'opening times', so I assumed there'd be a shop of some sort...

I poked my head round an open door. Piles of 25 kg malt of all types on the floor, large fermentors, piping... There was a guy there. I said, can you sell me some beer? Aye, ask in the office.

Anyway I walked away with an assortment of beers, principally the Pudding Shop Milk Stout, which I know is very nice. For twenty quid. I was pleased to see that most of their beers are in the 4-5% ABV range.

Better still, I asked, would you sell me some base malt? It only comes in big bags, we can't split them. I know, I said. 25 kg back is fine. Crisps, they had, best Pale. They would be happy to split 5 kg bags of hops, though, although I wasn't so interested in that. But yes, they would do me a bag of malt for 19 quid odd!

Excellent. I said, I'll be in touch...
 

crowcrow

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Lucky man! I went to a local one me and he said he can't sell me malt for tax reasons - ah well - was happy to buy some beer regardless!
 

foxy

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Lucky man! I went to a local one me and he said he can't sell me malt for tax reasons - ah well - was happy to buy some beer regardless!
I got told the same thing, even a winery, tried to get money knocked off for cash wouldn't do it. He explained the ATO knows how many bottles he buys! What no breakages? Same with the grain in the brewery, the ATO how much beer is produced on average from the amount of grain purchased. With a lot of businesses the ATO has an equation for what can be manufactured from the amount spent on purchases. All goes out the window when the manufacturer pays cash for a percentage of his purchases.
 

moto748

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Well I'm going up there in a month or so, to put their promises to the test, but if they will, it will obviously be very convenient for me, and I know there are a few other posters here who are not so far away from me.
 

crowcrow

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I've heard of others buying from breweries so it can be done I'm sure, I guess it is all down to how they do their books and if they already have connections to see on to mini or micro breweries.

Always a balance for me between a bargain and supporting homebrew shops/suppliers. But sadly no local shops around here for me!
 

pilgrimhudd

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I used to buy malt from a small brewery in Deadruth but since Covid it's all gone a bit quiet so i've gone back online. 🙁
 

Coffin Dodger

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It pays to make friends with your local brewer, and to this end an expensive bottle of whisky at Christmas is money well spent. Also if you are scrounging yeast, drop a suitable container in a week or so before you need it, so they can fill it when it suits them, not while you wait.
 

Northern_Brewer

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Lucky man! I went to a local one me and he said he can't sell me malt for tax reasons
I know what he's trying to get at, but he's wrong. There's a big dividing line in the application of VAT, between "essential" food that is zero-rated and "luxury foods" which attract 20% VAT. It was the reason for the famous Jaffa Cake legal case, where Mcvities persuaded the judge that Jaffa Cakes are cakes (which are zero-rated) and not chocolate biscuits (which are considered "luxuries" and rated at 20%). Result - Mcvities save several £m on VAT.

This kind of division gets really messy when it comes to brewing, as brewing uses a lot of ingredients that are also used in breadmaking etc - think malt loaves - which would normally count as zero-rated essentials. And the taxman prefers to tax brewing via beer duty and distilling via (higher) spirits duty, even though they use the same basic ingredients. Whereas homebrewing is counted as a hobby and so is a "luxury" like golf clubs etc, and in their eyes homebrewing deprives HMRC of beer duty, so on both counts the taxman wants to tax homebrewing.

Except VAT is applied to a product, and you can't change the VAT depending on the hypothetical usage.

So what they've come up with is VFOOD9000 - Excepted items: Materials for home brewing and wine making, an exception to zero-rating which applies the 20% rate to "retail packs of ...products specialised to home-brewing or wine making" (eg hops etc) and "retail packs of foods which are not specialised to home-brewing or wine-making...if they are held out for sale (ie packaged and labelled) for home brewing or wine making"

So the way they do it is by applying 20% VAT to retail packs, and 0% to "wholesale" packs - which would certainly include 25kg sacks of malt and 5kg boxes of hops. (you're on slightly dodgy ground once they start breaking up boxes of hops, but since Farams at least used to do 1kg packs aimed at breweries then 1kg+ is arguably OK).

But they don't have to worry about applying VAT just because you might use a 25kg sack for homebrewing - and if they get funny about it, then just say you want it to make granary bread!
 

moto748

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Well I wondered why, on the receipt they gave me,they charged me 20% VAT on the beer , but 0% on the malt.

But Northern_Brewer's explanation makes that clear, thanks!
 

Jim Brewster

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Anyway I walked away with an assortment of beers, principally the Pudding Shop Milk Stout, which I know is very nice.
Is that Prospect Brewery in Wigan? Have to admit I've never heard of them but just looked up where they are, I have driven past there many times and not even realised it was there
 

moto748

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Is that Prospect Brewery in Wigan? Have to admit I've never heard of them but just looked up where they are, I have driven past there many times and not even realised it was there
Yes Jim, it is. There are road works at the moment making access a little more complicated, though! or at least, there was the last time I went by that way.
 

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