Answer first
After a first Vaping Products Duty return, UK trade teams should be able to trace every declared figure to volume evidence, stock movements, duty status, stamp activity where relevant and commercial documents. The review should document exceptions, protect the audit trail and assign corrective actions before the next monthly close.
Key Takeaways
- HMRC requires VPD records and supporting evidence to be complete, legible, readily retrievable and retained for at least six years.
- Reconcile the duty account to product volumes, movements, imports, dispatches and, where relevant, the duty-stamp lifecycle.
- Where volume sources differ, HMRC may use the highest figure shown on the pack, invoice, delivery note or actual measurement.
- Wholesalers and distributors should retain supplier, purchase, sales and legitimacy-check evidence, including transition evidence for unstamped stock.
Timing note: Vaping Products Duty began on 1 October 2026. HMRC says the first return is due on 7 November 2026. Use these questions for readiness and immediately after filing.
Can the return be reconstructed from source records?
The first test is whether a colleague could rebuild the return from retained evidence. HMRC requires a duty account, stock and movement records, copies of returns and payments with workings, and an auditable trail from production, purchases, imports and movements to sale, export, destruction and duty declarations. Electronic records must be exportable in a readable format. HMRC’s VPD recordkeeping guidance is the baseline.
Test declared lines in both directions: locate the SKU, batch or import entry, volume, location and duty status, then the release, sale, export, destruction or closing balance. A spreadsheet total alone is not a traceable duty record.
Approved manufacturers submit monthly returns and payments online, including a nil return where no vaping products were manufactured. Keep close evidence for a nil period. HMRC confirms the requirements.
Do declared liquid volumes match supporting documents?
Volume is the calculation control to test first. Under the Finance Act 2026, Part 4, VPD is £2.20 per 10ml, rounded down to the nearest penny. Products below one litre must be calculated to the nearest 0.1ml. Where pack, invoice, delivery note and actual measurement differ, HMRC may use the greatest volume, subject to a clear-error exception. HMRC’s payment guidance explains the rule.
Review declared lines against the pack, invoice and delivery document. For production, retain the measurement method, calibration checks and reconciliation of measured, labelled and invoiced volume. Record the decision and correction for every mismatch.
Keep the product identifier, volume and pack hierarchy consistent across systems. This keeps VPD evidence distinct from product-information work, such as MHRA notification responsibilities for private-label products. A duty calculation or stamp record does not establish separate product-market requirements.
Are stock status, movements and duty points aligned?
A stock ledger should show quantity, volume, location, duty status and the event that changed it. HMRC expects these details for receipts, holdings, operations and dispatches. Goods held or moved in duty suspension also need movement evidence. It recommends monthly reconciliation of the duty account to production, movements, imports and sales or dispatches. See the recordkeeping guidance.
Duty points differ by route. UK-manufactured goods are generally liable at manufacture unless they immediately enter suspension; warehouse goods when they leave it; and imports on release unless they immediately enter suspension. HMRC’s payment guidance provides detail.
| Review area | Compare | Question to resolve |
|---|---|---|
| Declared volume | Pack, invoice, delivery note, measurement record | Which source is highest and why was it used? |
| Duty status | Stock ledger, warehouse account, movement documents | Has stock left suspension without a matching duty event? |
| Stamps | Orders, receipt, application or activation, stock logs | Can each stamp be accounted for? |
| Supplier evidence | Supplier details, invoices, delivery notes, transition checks | Can any unstamped stock be explained and evidenced? |
| Return close | Duty account, workings, filed return, payment confirmation | Can the total be rebuilt from source documents? |
Can stamp and transition-stock evidence withstand scrutiny?
Where stamps apply, reconcile their full lifecycle, not only whether a pack is stamped. HMRC lists orders and receipts, storage, activation, application and scanning, returns, and lost, stolen or damaged stamps. Its force-of-law notice specifies activation data and evidence requirements for destroyed and returned stamps. Read the HMRC force-of-law notice.
For wholesalers, distributors and retailers, the review may be supplier evidence rather than a duty calculation. Liable products released onto the UK market from 1 October 2026 require a stamp. Unstamped stock produced or imported before then may be sold until 31 March 2027. From 1 April 2027, products outside duty suspension must have a stamp. HMRC’s wholesale and retail guidance explains the transition.
Flag every unstamped grace-period line with production or import-date evidence, supplier identity, invoice, delivery note and decision record. See Aerova’s VPD guide for wholesalers for related trade context.
What should change before the next close?
Turn every first-cycle finding into a named control. Assign an owner and due date to unresolved volume mismatches, movement-document gaps, stamp variances, master-data errors and supplier-evidence gaps. Create a correction trail rather than overwrite a number.
HMRC recommends stamp reconciliation each accounting period, at least quarterly stock counts and documented investigation of differences. A proportionate close pack contains the duty reconciliation, exception log, inventory evidence, source documents and return or payment confirmation. Teams performing more than one role need the records for each role.
This article is general trade information, not legal or tax advice. Obligations depend on activities, approvals, supply route and the facts of each case. Refer to current HMRC guidance and obtain professional advice where needed. Aerova’s UK compliance centre provides related trade-information topics.
FAQ
Do businesses need records for a nil VPD return?
Yes. Approved manufacturers must submit a monthly nil return if they have not manufactured in that month. Retain the records and close evidence supporting the nil position. HMRC’s online-service guidance confirms this.
How long must VPD records be retained?
At least six years. HMRC says records and supporting evidence must be complete, legible and retrievable without delay; electronic records must be exportable in a readable format on request. See HMRC’s recordkeeping guidance.
Does a duty stamp replace product or supplier checks?
No. A stamp is part of the VPD framework. Businesses handling duty-paid products should retain commercial and legitimacy evidence, while notification and other applicable product requirements are separate matters. HMRC’s handling guidance describes relevant supplier and stock checks.
Official sources
- HMRC: Keeping records for Vaping Products Duty and the Vaping Duty Stamps Scheme
- HMRC: How to pay Vaping Products Duty
- HMRC: Get access to the Vaping Products Duty online service
- HMRC: Handling wholesale or retail vaping products in the UK
- HMRC: Vaping Products Duty and Vaping Duty Stamps force-of-law notice
- UK legislation: Finance Act 2026, Part 4
- MHRA: E-cigarettes regulations for consumer products
For B2B teams planning a documented supply review, use Aerova’s trade enquiry route to request a discussion about relevant product and supply information.