Manufacture of beverages

The manufacture of beverages is classified as a Qualifying Activity under the 'Manufacturing of goods or materials' category. Forensic auditors will verify that the entity is not merely bottling/packaging third-party liquids (which may shift the activity to 'Distribution' or 'Trading') but is performing the substantial transformation required for manufacturing status.

Audit Red Flag

Re-characterization of retail sales (B2C) as wholesale distribution to bypass the 5% de minimis threshold for non-qualifying revenue.

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