Winery and brewery bookkeeping in BC: inventory, excise and the tasting room

A winery or craft brewery in Langley runs three businesses under one roof: a production plant, a shop, and a licensed premises. The books have to follow each. That means costing every batch from raw ingredients to packaged stock, coding every tasting-room sale with the right sales tax, and keeping the excise and liquor-licence records that federal and provincial regulators can ask to see.

Township wineries and breweries often pour for weekend visitors in summer and sell wholesale the rest of the year. The tasting room pays the bills in July. Inventory carries the balance sheet in January. Both need to be right.

How should a winery or brewery track production inventory?

Track inventory in stages, with costs moving from one stage to the next as the product does. A practical setup has four inventory accounts:

• Raw materials: grapes, fruit, malt, hops, yeast, and other ingredients
• Packaging: bottles, cans, corks, caps, labels, and cartons
• Work in process: wine in tank or barrel, beer in fermenters and brite tanks
• Finished goods: packaged product ready to sell

Each batch or lot gets a number. When ingredients go into a tank, their cost moves from raw materials to work in process under that lot. When the batch is packaged, the ingredient cost, packaging, and a share of production labour and overhead move to finished goods. When a case is sold, its cost moves to cost of goods sold. This is how you learn what a bottle of the reserve red actually costs, rather than a blended guess across the whole cellar.

Volumes matter as much as dollars. Each month the litres in the books should agree with the cellar or brewhouse records, with differences explained: spillage, samples poured, lab tests, dumped batches. Unexplained gaps usually turn out to be a missed transfer or a packaging run nobody posted.

Estate wineries that grow their own grapes have one more layer. The vineyard's costs (labour, sprays, irrigation, equipment) become the cost of the grapes going into the press. The CRA's folio on farming notes that winemaking by an estate winery can be so tied to the vineyard that both are treated as one farming operation. Whether that is true for your winery is a question of fact for your CPA, and books that show vineyard and winery costs separately make it easier to answer. Our farm bookkeeping guide covers the vineyard side.

How does federal excise duty work for wine?

Under the Excise Act, 2001, anyone who produces or packages wine in Canada needs a wine licence from the CRA. The only exceptions are individuals making wine for their own use and customers bottling at an authorized bottle-your-own premises. Excise duty is imposed when the wine is packaged, and it is payable at that time by the licensee responsible for the bulk wine.

A winery can defer the duty by moving packaged wine immediately into an excise warehouse, which needs its own licence. The duty is then paid when the wine is removed from the warehouse for sale in the duty-paid market. In the books, that means duty-paid and duty-deferred stock should sit in separate inventory locations.

Some wine is relieved of duty altogether:

• 100% Canadian wine made from honey or apples
• Wine produced by a small producer and packaged by or for that producer
• Wine with 0.5% alcohol or less

A wine licensee is a small producer in a fiscal month if its total sales of wine packaged in Canada were $50,000 or less in the previous fiscal year and have stayed at or under $50,000 so far in the current one. A small producer must still hold the licence and file returns.

The broader exemption for wine made entirely from Canadian-grown product ended on June 30, 2022. BC grape wine now pays duty unless one of the reliefs above applies.

Wine duty is charged per litre, at one of three rates set by alcohol content. The rates are adjusted every April 1 based on the Consumer Price Index. Bill C-30, which received royal assent on June 18, 2026, keeps the annual increase capped at 2% for two years. Check the CRA's excise duty rates page for the current figure before you budget.

Wine licensees file Form B265 for each reporting period. The default period is a fiscal month, and the return and payment are due by the last day of the following fiscal month; some licensees are authorized to file twice a year instead. Volumes and alcohol content must be measured with instruments the CRA has approved.

How does federal excise duty work for beer?

Beer falls under the older Excise Act. The CRA's circular ED212-11 is clear that anyone who manufactures beer must be licensed, regardless of the size of the brewery. For excise purposes, beer is produced when it is packaged, and the duty is calculated on the volume packaged.

Beer duty is charged per hectolitre, at rates set by alcohol content in three bands. Beer with 0.5% alcohol or less is not subject to duty. Like wine, the rates are adjusted every April 1, and the annual increase is capped at 2% for two years under Bill C-30.

Canadian brewers pay reduced rates on the first 75,000 hectolitres of beer brewed in Canada each calendar year. The reduced rates step up in increments as volume grows, and the rates on the first 15,000 hectolitres remain cut by half for two years under Bill C-30. The 75,000 hectolitre limit is shared among related or associated brewers, who must file an agreement showing how they split it. Imported beer and beer made from imported wort pay the regular rates.

Brewers report on Form K50B, usually monthly, though some are approved to file semi-annually. To support any credit claims, the CRA expects brewers to keep records showing the year the beer was produced and the rate of duty paid. Its worksheets RC633 and RC634 are optional, but the information on them has to be in your records.

For bookkeeping, excise duty is a cost of the product. Post it to a duty expense or into finished goods inventory, consistently, and reconcile the duty account to your filed returns each month.

How is BC PST charged in a tasting room?

Liquor sold in BC carries PST at 10%, compared with the general 7% rate. Bulletin PST 121 applies the 10% rate to beer, cider, mead, wine, spirits, coolers, and any other beverage over 1% alcohol. GST at 5% applies on top.

The bulletin also covers the sales that make tasting-room tills tricky:

Sale	PST rate
Bottle, can, or glass of wine, beer, or cider	10%
Tasting fee	10%
Free tasting	None charged; the liquor is promotional material
Chill charges included in the liquor price	10%
Bottle or can deposits	None
Growler bottle	7%
Growler fill or refill	10% on the liquor
Souvenirs, glassware, clothing	7% (children's clothing has its own exemption)
Keg leased with liquor for one price	Split: 10% on the liquor's value, 7% on the keg lease

Set up each item in the POS with its tax code once, then reconcile the POS to the bank deposits daily. Wine club charges, online orders, and event bookings each settle differently, and all of them need to land in the same sales accounts with the same tax treatment.

Free tastings are not tax-free to you. PST 121 treats liquor given away as promotional material, and Bulletin PST 311 sets out how PST applies to it. Ask your CPA or the province's PST line how that applies to your volume of free pours.

On the purchase side, ingredients that are food for humans (malt, hops, yeast, fruit) are exempt from PST. So are labels and packaging that leave with the product. Production equipment may qualify for the production machinery and equipment exemption. Filters, cleaning supplies, POS hardware, and reusable kegs are taxable. Our GST and PST filing service keeps these codes straight and files both returns.

What do BC liquor manufacturers have to report, and to whom?

In BC, wineries and breweries answer to two provincial bodies. The Liquor and Cannabis Regulation Branch (LCRB) issues and enforces the manufacturer licence. The Liquor Distribution Branch (LDB) holds the Manufacturer's Agreement that every BC manufacturer must sign under the Liquor Distribution Act.

The LCRB's Manufacturer Licence Terms and Conditions Handbook requires you to keep, for at least six years, and produce on inspection:

• A general financial ledger, and a production and inventory ledger and journal
• The volume of harvested products used in manufacturing
• Invoices showing quantity and price for ingredients, including those containing liquor
• The quantity of bulk and packaged liquor manufactured
• Quantity and price for liquor sold to other manufacturers and to buyers outside BC
• Liquor lost to spillage and used in sampling

The licence must be renewed and fees paid by March 31 each year. For wineries and breweries, the renewal fee is calculated on the volume of liquor made in the year and on whether you have a store, lounge, or special event area. That makes your production records part of your licence fee calculation.

The Manufacturer's Agreement with the LDB covers product registration, who you may sell to, reporting sales, remitting money for those sales, and record keeping. The handbook adds that sales at artisan and farmers markets must be reported as on-site store sales. The reporting schedule and format are set in your own agreement, so keep a copy with the books and check it when you set up your month-end. If anything is unclear, ask the LCRB or the LDB directly.

What does a monthly close look like for a winery or brewery?

Daily sales come in from the POS, production records from the cellar or brewhouse. Each month we reconcile sales and deposits, post batch costs and inventory movements, reconcile the excise duty account, and file GST and PST. By the 10th you see gross margin by channel: tasting room, wholesale, online, and events.

That routine is our monthly bookkeeping service. When the operation outgrows a bookkeeper, with multiple licences, a second site, or lender reporting, a fractional controller can own costing and forecasting. See how we work with Langley wineries, breweries, and hospitality businesses, or start with the Langley owner-operator's guide to bookkeeping.