Why your investment portfolio should consider Whisky Casks for 2023

All our articles are designed to be informative and easy to digest for our existing and potential customers. Whisky values can go down as well as up. When buying a cask, spend only what you can afford to put at risk. Please get in touch with any questions you may have at sales@macinneswhisky.com. No question is a silly one...

It’s no secret that we’ve been experiencing an economic downturn for the past 18 months, following Brexit, COVID-19, and political conflicts. Therefore, investing during such an uncertain time can be daunting, and choosing where to invest even more so.

As a Scottish product, whisky is inherently connected to the UK market, so you’d think it would be affected by the current economic instability? Well, this is not the case.

In the 2020 Knight Frank Wealth Report, bottled rare whisky had seen an increase of 564%* in the past decade, and The Scotch Whisky Association states that Scotch whisky is the world’s number one internationally traded spirit with exports worth almost £4 billion annually. That’s around 36 bottles sent around the world from Scotland every second.

The whisky industry has never been more prosperous.

Rest assured, as whisky is linked to consumer demand (which continues to increase), rather than the stock market or other global financial instruments, whisky casks remain a compelling alternative to your portfolio of traditional investments, including luxury assets such as cars, watches, stocks, and premium bonds.

What are the benefits?

Owning a single malt cask of whisky is rare, whether you choose to purchase it because you enjoy whisky and feel pride in seeing that certificate to a cask of your own, or to enjoy the financial benefits for years to come. It’s something you can buy yourself, or gift to loved ones that will almost certainly increase in value, during these somewhat uncertain times.

It’s also highly versatile, too. Will you let it mature in taste over time and sell when the time is right? Bottle it? Drink it? It’s up to you.

Capital Gain Tax Free

Whilst your cask is stored in a warehouse, it is in ‘duty suspension’ so no VAT or excise are payable on it.

Also, as it is a wasting asset according to HMRC (due to the ‘angel’s share’ or minor evaporation that occurs to cask whisky each year) whilst in the bonded warehouse, it has the unique tax status of being capital gains tax (CGT) free, so when you sell your cask for a profit, you pay no tax on it.

Eliminating the stereotype

Owning a whisky cask has become an opportunity for everyone. At first, it was considered limited to those “super-wealthy”. However, over the past two decades there has been a shift in the market, opening to the broader investor population. Payment plans have become available, and with single entry level Malt Scotch whisky casks starting from £4,000 – there’s a gift option for any budget.

As a conclusion, the Scotch whisky market does not seem to be slowing down any time soon, and it’s understandable why many investors are excited about the whisky industry and where it can go in the future. As too, am I.

At MacInnes, our team comprises experienced financial advisors and accountants, all Whisky Academy-qualified. With our expertise, we can help you identify the best cask or portfolio for you.