Investing in Wine

I had a catch up with an old friend yesterday and he was talking about the fact that he’s started investing in wine recently.

Now, I (naively!) had it in my head that that meant, he was going out and buying bottles to store in some cellar he had. But it’s not that, it’s more that he ‘buys’ wines from suppliers who keep and store it on their premises and he then receives bids/offers for that wine from other users - so it’s a proper marketplace.

In addition, the returns he’s seen has outstripped standard ISA investment and the returns are tax free.

Is anyone else doing this? It’s peaked my interest.

Cheers,

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Be carful of this, this isn’t true. There may be tax depending on how you hold and sell the assets depending on if it’s considered a business or a chattel asset.

To answer your question though, I have some whiskey which is physically bought and double my money over the course of the year. Money made is under all the allowances, I don’t consider it a large investment option.

I am intrigued.

Do you know the name of the provider?

The no tax claim is likely false.

  1. Wine investment is not tax-free!

This is quite complicated and you may well need specialist tax advice.

All too many wine investment companies claim that a big advantage of wine investment is that it is free of tax. They base this claim on HMRC (Her Majesty’s Revenue & Customs) considering wine to be a ‘wasting asset’. It is not that simple. A ‘wasting asset’ has a life of less than 50 years. Although many wines are unlikely to be drinkable after 50 years, this is not the case for many investment grade wines, especially from good to great vintages.

HMRC: ‘However, where the facts justify it, we would normally contend that wine is not a wasting asset if it appears to be fine wine which not unusually is kept (or some samples of which are kept) for substantial periods sometimes well in excess of 50 years.’

https://timatkin.com/cork-talk/the-ten-things-you-need-to-know-about-wine-investment/

https://www.bbr.com/fine-wine/bbx

You can also go straight to Liv-Ex and code against their API if so inclined. Its fun to see an active 2 way market in fine wine.

Glad to hear he’s using a reputable firm. Anyone considering investing in wine should do their research, there are plenty of scam firms out there who will ‘invest’ your money in their pockets and send you fake reports about ‘your’ wine.