Your cask whiskey questions answered
This depends on the types of casks we have at any given time, please contact the team and we can get in touch to discuss our current availability.
On average, each cask costs our investors €2,400 – €2,900 depending on the distillery you’re buying from and the specifics of the cask and spirit. This price covers the cask, the 200 litres of whiskey inside the cask (this is a rough guide as casks are made by hand so not all are exactly 200 litres), plus storage and insurance for five years. The whiskey’s title and ownership are registered in your name and as you own the asset, you can sell (or bottle) the whiskey at any time.
Buying the cask itself and having its ownership transferred to you only takes a few weeks. Once you have your casks you are able to sell at any time, as there will always be a market for whiskey of any age. We recommend a minimum of three years but the investment can be held for much longer.
The return depends largely on how long you’re able to hold the whiskey. We advise our clients that a typical return ranges from 12% to 20% per year.
Experts predict the growth of Irish whiskey to continue in double digits for at least another 20 years. The IWSR (International Wine and Spirits Record) which is the global benchmark for alcohol and beverage data, predicts Irish to outgrow Scotch and bourbon. The IWA (Irish Whiskey Association) anticipates the market to double in the next 10 years.
Scotch whisky is a great category in that Single Malt sales are rising annually in what is the world’s most stable whisky market. Therefore, it is another very safe play to be holding maturing Scottish Single Malt casks for the future. Demand is soaring for it. Investors should always be mindful of the risks that are present. Despite this, whiskey presents excellent opportunities. It is rapidly growing and winning global awards. Demand is surging, yet supply is yet to bridge this gap. We’ve always thought of whiskey as liquid gold – and it’s great to see consumers and investors around the world turn their heads back towards it.
Whilst cask whiskey is alternative, the core fundamentals of investing still apply. Undertake your own research and due diligence. Make sure you’re fully aware of just what you are purchasing and seek expert advice beforehand.
Naturally, an element of risk is present, and returns cannot be guaranteed.
- Demand slowing down and prices dropping as a result
- Oversupply of the market
- A warehouse fire (our insurance covers this)
- Rules and regulations change requiring investors to seek new licences to sell
- Alcohol becoming outlawed in certain countries
- An outbreak of major conflicts which could create difficulty for global exports
Once casks have been purchased, investors receive a certificate of ownership. This is a legally binding document confirming their ownership. In some cases (depending on the bonded warehouse) they also receive a bonded warehouse storage certificate relating to each cask number. This also confirms storage fees have been paid in full.
In Ireland, we purchase the casks under our bonded tenancy agreement with the Irish Revenue Commissioners and the excise warehouse. We then have a legal contract in place. Granting our clients full, beneficial and unencumbered ownership of each cask purchased. We simply hold them in trust under our tenancy until such a time as our clients wish to sell.
The value of a cask of whiskey is primarily determined by its age, quality, and scarcity. Generally speaking, quality and scarcity will have greater bearing on the value than age alone. While it’s likely that most cask whiskey would increase in value, a cask from a renowned distillery that produces a small number of casks per year is likely to sell for a much higher price after 25 years than a mass-produced, unbranded cask of the same age.
Whiskey & Wealth Club work exclusively with distillers who produce premium casks for well-known luxury brands. We’ve spent years cultivating relationships with the distillers who have made high-end whiskey what it is today to be able to offer our clients the best potential for future returns.
Rare, branded casks have historically tended to sell for greater amounts than unbranded casks of the same age; however, there is natural vairance between even high-quality casks that can make it difficult to predict a particular per annum percentage by which they may increase in value. Though the market for whiskey is relatively stable, an investment in casks whiskey is an investment nonetheless, and the value of a cask may be subject to market fluctuations or other potential unforeseen events.
There are a number of exiting strategies you may consider when exiting your investment. These include selling to an existing whiskey brand for bottling, selling to private investors or collectors, selling at a whiskey auction or bottle and label it yourself. The Whiskey & Wealth Club team will be there to support you with whichever strategy you choose.
Everybody’s tax situation is different so we recommend that our clients speak to an accountant to advise on this.
Viewing the storage facilities depends on the distillery. Our casks are held in secure, government bonded warehouses and we need to arrange access beforehand. If you’re considering investing with us, one of our advisors can let you know when the next distillery or warehouse tour is taking place.
We started trading in 2018. Our co-founders have over 40 years of experience in the investment and beverage industries. Since then we have built a team of advisors who have a wealth of experience between them. We partner with Irish and Scottish distilleries that have a proven track record. This allows us to offer the best pure pot still and malt for our investors to invest in.
In the UK, FCA does not currently regulate the wholesale buying and selling of cask whiskey. The buying/selling of cask whiskey falls under HMRC regulation. Whiskey & Wealth Club, however, aim to adhere to as many of the standard FCA checks as possible. Before accepting an individual or entity as a client, we conduct various extensive checks including Anti-Money Laundering (AML) and Know Your Customer (KYC). We have a full due-diligence protocol in-house.
We also ensure we are dealing with a reputable distillery and excise warehouse who must follow strict laws imposed by HMRC. Using HMRC approved cask accounting systems such as DRAMS to make sure no cask number can be duplicated. This technology also gives full visibility of maturing whisky – down to the location of every cask. With audit trails to keep records in order, and DRAMS even completes Government Excise Reports.
Amongst other checks and balances like HMRC distillery audits, regular site visits from Whiskey & Wealth Club and our clients, and through many other regulations, we can ensure clients holding casks are protected.
The UK has a well-established secondary whiskey market. HMRC regulates this and so firms dealing in wholesale whiskey brokering must hold appropriate licences with HMRC and undergo a rigorous application process to do so. A licence called a WOWGR must be held. Should any firms you speak to not have a WOWGR, buyer beware. Whiskey & Wealth Club took exactly 8 months using the top specialists in the country to attain a WOWGR. It’s not an easy process. It requires in-person interviews with HMRC, site visits, background information, business plans and applications the size of a phone book. Additionally, we have strict processes in place ongoing to meet the standards HMRC sets out.
We’re regulated for the information we store, where it’s stored and how it’s stored. Far deeper than the usual GDPR regulations. We invested over €150,000 to upgrade our office to a fully paperless operation with a custom-built CRM to adhere to these strict regulations.
Around 2% of the spirit inside the casks evaporates each year. So the angel’s share will depend on how long you keep your investment for. Despite losing the angel’s share the insurance on the casks is increased every year in line with the increased value as it ages.
Once you have your casks you are able to sell at any time, as there will always be a market for whiskey of any age. We recommend a minimum of three years but the investment can be held for much longer.
A bonded warehouse is a tax-free storage location. Duty and tax payable on goods held there are deferred until the goods are shipped out, usually by a professional blender, who acquires your whiskey for bottling when it is mature. Because of the high potential tax take from alcohol, bonded warehouses are closely monitored by the government and are among the safest of storage locations for goods. In addition, your whiskey is insured against loss or damage.
This is highly unlikely given the people and the capital where your whiskey will be stored. However, in such an unlikely event, you can simply move your casks to any other bonded warehouse facility in Ireland or Scotland, of which there are many. And increasingly, more are coming online as the whiskey market continues a resurgence to its former glory.
Sadly no, all whiskey purchased from our distillery partners must be stored in government-controlled, bonded and insured warehouses. Duty and tax payable on goods held at these warehouses are deferred until the goods are ready to be sold or bottled. Storing the whiskey in these warehouses also ensures quality as the casks are regularly checked by experts. But we do agree that it would be nice to have some casks to show off at home!
The insurance company we use is Aviva plc. With over 33 million customers, operating in 16 countries, and close to £50 billion in annual revenue, they are one of the world’s largest and most trusted insurance companies.
We purchase the casks under our bonded tenancy agreement with the Scottish and Irish Revenue Commissioners and the distillery. We then have a legal contract in place, granting you full, beneficial and unencumbered ownership of each cask you purchased. All cask numbers are registered with the Revenue Commissioner. We also keep a record, as does the distillery. We maintain a register at the Whiskey & Wealth Club. Each cask is numbered and held in the bonded warehouse. In addition, you will receive a Title Deed Certificate outlining which casks you own, so there will never be any doubt which casks belong to you.
Your whiskey is insured against fire and theft for their value at that time. Each year, the insurance company reassess the value of the whiskey. In the very unlikely event that your casks are damaged, stolen or the warehouse catches fire, your whiskey will be replaced by a cask of equal value or you will receive an insurance payout. The last whiskey warehouse fire was in 1875, so this is highly unlikely.
There is no bootlegging secondary market for whiskey, therefore, the theft would make no sense. Whiskey is all recorded with the Revenue Commissioner. It cannot be sold anywhere unless they get their cut. Everything is tracked. Whiskey casks are heavy and require trucks and machinery to remove them, with 24/7 security and no reported theft in the history of the warehouse, it’s very unlikely. The warehouses in 2018 are all fire regulated and have sprinkler systems installed. There are millions of euros in stock sitting in these warehouses.