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A Landlord's Guide to HMRC's Consultation on Tobacco Duty Evasion

HMRC have published a consultation into potential measures to curb the evasion of Tobacco Duty in the UK. Landlords of commercial premises should be aware of two of the provisions:

1. HMRC will ask landowner associates to put a clause into their standard leases banning illicit tobacco and excise trading on their premises.

2. HMRC will also create a duty of care on landlords to prevent illicit trading on their premises. This would only apply if the landlord had already been notified that the tenant had evaded tobacco duty. Landlords would then be required to take steps including:

  • Writing a provision into the lease that it will be terminated if the tenant engages in illicit excise trading and evict tenants that do not comply with this.

  • Providing HMRC with a copy of the tenancy agreement.

  • Undertaking regular checks on the premises and requesting information about their business.

  • Taking steps to ensure they are aware of illicit activity, contacting HMRC or Trading Standards if they have concerns.


Inclusion of a standard term prohibiting illicit excise training is not a particularly controversial position to take. In fact, as the consultation notes, this will often be subsumed by common existing clauses preventing illegal behaviour on the premises.

The duty of care is much more onerous however. This could potentially force landlords to carry out expensive and time consuming checks to avoid liability, especially where the tenant is in an existing lease that does not include the provision banning illicit tobacco trading and therefore cannot easily be evicted.

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