Food, Drink & Hospitality UK-wide

Make soft drinks and bottled water: levy, recognition and water abstraction

If you make soft drinks or bottle natural mineral water, spring water or bottled drinking water, you face three obligations on top of the universal food-safety duties: the Soft Drinks Industry Levy on added-sugar drinks, formal recognition before you can market a product as natural mineral water, and a water abstraction licence if you take water from your own source. This guide takes you through each in turn.

Guide summary

Register for the Soft Drinks Industry Levy if you produce or package sugary soft drinks and are not a small producer. Get your water source formally recognised before you label any water as 'natural mineral water'. Get a water abstraction licence before you take more than 20 cubic metres a day from your own borehole, spring or watercourse.

  • Register with HMRC within 30 days of becoming liable for the Soft Drinks Industry Levy
  • Pay 19.4p per litre for drinks with 5g to 8g sugar per 100ml (from April 2025)
  • Pay 25.9p per litre for drinks with 8g or more sugar per 100ml (from April 2025)
  • Check if you qualify as a small producer – under 1 million litres a year – to be exempt
  • Apply to your local authority in England to get your source recognised as natural mineral water
  • In Scotland, Wales or Northern Ireland, use the equivalent devolved authority
  • Get an abstraction licence from the Environment Agency (England) or Natural Resources Wales if you take more than 20 cubic metres per day
  • In Scotland apply to SEPA for a CAR licence; in Northern Ireland to NIEA
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Makers of soft drinks and bottlers of water are food businesses, so the universal food-safety duties apply to you. On top of those, three things are specific to this trade: a levy on drinks with added sugar, formal recognition before you can market a product as natural mineral water, and a licence if you abstract water from your own source.

The sections below take each in turn. Work out which apply to your products and source, then build the ones that do into your routine.

A. Register for and pay the Soft Drinks Industry Levy

The Soft Drinks Industry Levy applies to packaged soft drinks with added sugar above a sugar-content threshold. If you produce or package liable drinks, you must register with HMRC, report the volumes you put out, and pay the levy — unless you qualify as a small producer. This applies wherever you are in the UK. The thresholds, rates and the small-producer line are in the snippet below.

B. Get your source recognised before marketing natural mineral water

You cannot label or market a product as "natural mineral water" until your source has been formally recognised. Recognition confirms the water comes from a protected underground source and meets the purity and composition rules. Apply for recognition before you sell.

This is devolved. In England, the local authority for the area where the source is exploited grants recognition. Scotland, Wales and Northern Ireland each run equivalent recognition procedures through their own authorities. Note the distinction: "spring water" also comes from an underground source but does not need formal recognition; "natural mineral water" does. The snippet below sets out what recognition involves.

C. Get a water abstraction licence

If you draw water from your own surface or groundwater source — a borehole, spring or watercourse — above the licensing threshold, you need an abstraction licence before you take it. Buying mains water from a supplier does not trigger this; abstracting your own does.

The regulator depends on where you abstract. In England it is the Environment Agency; in Scotland, the Scottish Environment Protection Agency under a Controlled Activities Regulations (CAR) licence; in Wales, Natural Resources Wales; in Northern Ireland, the Northern Ireland Environment Agency. The snippet below covers the licence and the threshold.

  1. 1

    1. Check whether your drinks are liable to the levy

    Identify which of your packaged drinks contain added sugar above the threshold. If any are liable, register with HMRC for the Soft Drinks Industry Levy before you report and pay.

  2. 2

    2. Apply for natural mineral water recognition

    If you intend to market a product as natural mineral water, apply to the relevant authority for your nation and get recognition confirmed before you put it on sale.

  3. 3

    3. Apply for a water abstraction licence

    If you abstract water from your own source above the threshold, apply to the regulator for your nation for a licence before you start taking water.

  4. 4

    4. Build all three into your compliance routine

    Set up ongoing levy reporting and payment, keep your recognition valid, and meet the conditions on your abstraction licence alongside your day-to-day food-safety controls.

What to do next

These obligations sit on top of the food-safety basics, not instead of them. As a soft-drinks or water maker you are still a food business, so make sure the universal spine is in place first: registering your establishment, running a HACCP-based food-safety management system and labelling correctly. See Register and run a safe food and drink manufacturing business for the spine, and work through the food safety compliance checklist to confirm nothing is missing.

Official sources

Use these GOV.UK and legislation sources to register, apply and check the rules.