Notice

Excise Notice 147: Pool Betting Duty

Published 1 September 2010

This notice was withdrawn on 20 August 2015

This notice 147 is out of date and should not be used. Please read Excise Notice 147: Pool Betting Duty (pre 1 December 2014).

This notice 147 is out of date and should not be used. Please read Excise Notice 147: Pool Betting Duty (pre 1 December 2014).

Foreword

The law covering record keeping requirements is in Regulation 6 of the Revenue Traders (Accounts and Records) Regulations 1992. Parts of this notice have the force of law under these regulations. These paragraphs are indicated by being placed in a box as shown below.

Example:

The following rule has the force of law

Pool Betting Duty must be paid to the Commissioners no later than the 15th day of the month following the end of the accounting period.

1. Introduction and basic information

1.1 What is this notice about?

It explains:

• who is liable to pay Pool Betting Duty
• which bets and competitions are liable to duty
• when you must apply for a permit and about notifying us of your premises
• the rate of duty and how it is calculated
• who has to account for Pool Betting Duty
• what records and accounts you must keep
• our legal powers

The notice has been amended to include the following changes - introduction of quarterly accounting periods for qualifying promoters from 26 September 2010 (section 7).

This notice is aimed at pool betting promoters and anyone else involved in providing facilities for playing pool betting.

1.2 What is pool betting?

Pool betting applies where a number of people make bets, other than at fixed odds (see paragraph 2.3), in particular, where:

• the winners will share the stakes paid or agreed to be paid (regardless of how the bets are made)
• the winners will share an amount (not decided by the stakes paid or agreed to be paid). For example, where a promoter puts up a money prize to be divided amongst the winners
• or the winnings are at the discretion of the promoter or some other person

1.3 What is the rate of Pool Betting Duty?

Pool Betting Duty is 15% of a promoter’s net pool betting receipts from dutiable pool bets in an accounting period. You can check the rate on the HM Revenue and Customs (HMRC) website or by phoning the Excise Helpline on Telephone: 0300 200 3700.

1.4 The Gambling Act 2005

It governs the operation of pool betting and currently contains separate requirements for both operating and premises licences. If you have any queries about this law, please consult either of the:

• Gambling Commission
• Department of Culture, Media and Sport

1.5 Overlap with social regulatory law

It is the Pool Betting Duty legislation which determines the duty treatment. All the gambling duties are self assessed taxes and a taxpayer is obliged to calculate, notify, and pay any duty due. If a taxpayer has queries about their Pool Betting Duty they should refer to guidance issued by us. We will answer individual queries from taxpayers. If we give a ruling, then in some circumstances a taxpayer is entitled to rely on that ruling even if it is later shown to be wrong. However, a taxpayer is not entitled to rely on an opinion, or any guidance written by the social regulator (such as the Gambling Commission), even if the opinion relates to an identical piece of legislation.

2. About the duty

2.1 What is Pool Betting Duty?

Pool Betting Duty is charged on your net pool betting receipts (commonly called your ‘gross profits’) from dutiable pool bets in an accounting period, as explained below. Full details are given in section 6, but essentially, the amount of your net pool betting receipts are:

S + E - W

• S is the total of stakes falling due to you in the accounting period in respect of dutiable pool bets
• E is the total of expenses and profits (not met from stakes) attributable to that period
• W is the total amount paid by you in that period as winnings in respect of those dutiable pool bets

2.2 What are dutiable pool bets?

Dutiable pool bets for the purposes of net pool betting receipts calculations are bets made by way of pool betting. These bets must be made with a person in the UK who is a promoter of pool betting or an operator of a totalisator in the UK, provided the pool betting is not:

• made wholly in relation to horse racing or dog racing
• made for community benefit (see section 3)

2.2.1 Transactions included as ‘bets’

A ‘bet’ includes certain transactions, which would not otherwise be regarded as bets. Also, certain payments are treated as stake money for the purposes of the net pool betting receipts calculation, explained as follows:

Where a person makes a payment for the chance to win money or money’s worth and that person has the power of selection that may directly or indirectly decide the winner, that payment is treated as a bet, it does not matter whether the person uses the power of selection or not, since Pool Betting Duty is still due on that bet.

For example:

You run a pool betting competition with a cash prize and players are allocated a set of numbers, which refer to football matches each week, the competition also allows players to change their numbers each week if they wish, however, even if players decide to stay with their original numbers, this arrangement is still pool betting and liable to duty

Where a person makes a payment to take part in a transaction, which they do not consider to be a pool bet, this is because they do not regard the payment as a stake, however, this transaction is nevertheless treated as a bet for Pool Betting Duty purposes.

For example:

You run a fantasy pool betting competition (see paragraph 4.2) in which players can change their initial selection on payment of an ‘administration fee’, this payment is regarded as a stake and the transaction is, therefore, a bet.

2.2.2 What is not treated as a bet?

• when taking a ticket or chance in a lottery
• any stake placed in the course of gaming (see Notice 453 Gaming Duty)

2.3 What is a bet at fixed odds?

Fixed odds bets are where each bettor knows, or can know, at the time of making the bet how much he will win if he is successful.

Fixed odds bets are usually liable to General Betting Duty (see Notice 451 General Betting Duty).

3. Community benefit

3.1 What does a ‘bet made for community benefit’ mean?

For Pool Betting Duty purposes, a bet is made ‘for community benefit’ if the:

• promoter of the pool betting or operator of the totalisator is:
  - a ‘community society’
  - is bound to pay all benefits from the pool betting to such a society
• person making the bet knows, when making it, that the purpose of the pool betting is to benefit such a society

‘Community society’ for these purposes means a society established and conducted:

• for charitable purposes only
• wholly or mainly for the support of athletic sports or athletic games and not for purposes of private gain

‘Society’ includes any club, institution, organisation or association of persons, by whatever name they are called.

3.2 What if HMRC don’t agree that a bet is made for community benefit?

To prevent avoidance, the law gives HMRC the power to direct that any bet of a specified description, ‘is not a bet made for community benefit’. We expect to use this power rarely but will issue a direction where we consider that:

• an unreasonably large part of the amount paid in respect of the bets concerned is not being paid as winnings
• is not being applied for the benefit of a community society

It is difficult to be precise about what we consider to be ‘unreasonable’. It will depend on the size of the pool and we will consider each case on its own merits. However, among the factors we will look at are whether:

• any amount retained from stakes for expenses covers more than the actual cost incurred in running the competition
• those expenses are necessary and realistic
• they include, for example, excessive commissions

4. Particular competitions and bets

4.1 Is a ‘Spot-the-Ball’ competition pool betting?

A pool bet may be on a past event, where the result is not generally known. If the ‘Spot-the-Ball’ competition is to determine as nearly as possible the actual position of the ball in the original photograph, a player bets on this past event. Such a competition is pool betting. However, if a competition is decided by reference to the decision of a panel of judges, this is not pool betting.

The supply of a right to play this form of ‘Spot-the-Ball’ is a taxable supply for VAT purposes. See Notice 701/26 Betting and Gaming.

If you intend to run a competition that is similar in nature to ‘Spot-the-Ball’ and are unsure whether it is classed as pool betting, you should contact the Excise Helpline, Telephone: 0300 200 3700. You will need to supply full details of the specific rules of your competition.

4.2 Is a ‘Fantasy’ competition pool betting?

Whether ‘fantasy’ and similar competitions fall within the definition of pool betting will depend upon the rules of the competition. Generally, any competition that constitutes betting and has an entry fee and prizes is liable to duty. Betting competitions will normally, but not always, include the forecasting of a future event or events. This includes, for example, a player picking a team, which he thinks will perform better than any other player’s team over a given period.

If you intend to run a competition that is similar in nature to ‘fantasy’ competitions and are unsure whether it is classed as pool betting, you should contact the Excise Helpline, Telephone: 0300 200 3700. You will need to supply full details of the specific rules of your competition.

4.3 What about competitions involving telephone entries?

The courts have held that, where a player pays for entry to a competition and makes choices in forecasting uncertain future events, but does not make these choices directly to the promoter of the competition, the player’s payments are not deemed to be stake money. As there is no stake, there cannot be a bet. This means that where entry to such a competition is made by means of a premium-rate telephone call (for example, payable to BT), payment for the telephone call is not deemed to be a stake. The competition is not, therefore, pool betting.

If you intend to run a competition that is similar in nature to that described above (including those which involve entry other than by means of a telephone call) and are unsure whether it is classed as pool betting, you should contact the Excise Helpline, Telephone: 0300 200 3700. You will need to supply full details, including specific rules of your competition and contracts with the entry service provider.

4.4 How do I treat free bets?

Without stake money, there is no bet for Pool Betting Duty purposes. This means that if you pay winnings to a person who did not bet, those winnings cannot be included in your net pool betting receipts calculation.

Alternatively, you may decide to give away free bet vouchers in newspapers, or other advertising sources. If you are reimbursed for the value of these vouchers, you must include any payments you receive and any winnings you pay out in respect of such bets in your net pool betting receipts calculation in the normal way.

4.5 How do I treat discounted bets?

If you offer discounted bets, the value of the stake is the amount that your customer pays. For example, an individual playing the football pools weekly pays £1 per week. However, he can make a standing forecast for a whole year for £48, a discount of £4. For the purposes of the net pool betting receipts calculation (see section 6), the weekly stake is 48/52 of the amount paid.

4.6 How do I treat void bets?

If a bet becomes void and you refund the stake paid to your customer, you must treat the refund as winnings. This will cancel out the value of the stake when you calculate your net pool betting receipts. We may need proof that you have refunded a stake. Simply failing to receive payment from your customer does not make a bet void.

4.7 Is overseas betting allowed?

The law contains a number of revenue protection provisions, which prohibit specified activities being carried out in the UK. These provisions cover activities that relate to betting with a foreign bookmaker, a totalisator operator or pools promoter.

If you are a pools promoter in the UK, you may, however, accept entries from players overseas. You must include the stakes in your net pool betting receipts calculation in the normal way.

4.8 What about bets made by overseas punters via the internet?

Bets placed over the internet are no different from other bets. If you are a pools promoter or totalisator operator in the UK who accepts bets over the internet, you must:

• include the value of all stakes, etc, due to you
• all winnings paid out

when calculating your net stake receipts at the end of an accounting period.

5. Registration permits and notification

5.1 Do I need a permit from HMRC before I start trading?

Yes. You must not carry on a pool betting business, even if it is for community benefit, unless you hold a permit from us authorising you to do so. There is no charge for granting a permit and you do not need to renew it.

If you intend to promote or operate a totalisator for pool betting you must complete a permit application form BD2. You can download a copy of this form from the HMRC website, or contact the Excise Helpline, Telephone: 0300 200 3700. Send it together with a completed form EX103 or EX103A (see paragraph 5.4) to:

HM Revenue and Customs
National Registration Unit
Betting and Gaming
Portcullis House
21 India Street
Glasgow
G2 4PH

If your pool betting is for community benefit, you must prove this by sending a copy of the rules of your intended competition(s) and any supporting documents as listed in paragraph 5.2 below.

You must also advise us separately of the premises or totalisator used for the purposes of the business (see paragraph 5.4).

We will issue a permit within 14 days of the date of the application. Remember to send all the necessary information so we can process your application promptly.

Important note: if you operate a pool betting business without holding a pool betting permit, you are committing an offence and will be liable on summary conviction to a penalty, imprisonment, or both, (under the Betting and Gaming Duties Act 1981, Schedule 1, paragraph 14(1)).

5.2 What should I do if I have a permit but my pool betting now qualifies for the community benefit exemption?

You should immediately write to the National Registration Unit (NRU) see paragraph 5.1 above, or alternatively ask them to send a ‘community benefit exemption questionnaire’ for your completion.

You will need to enclose with your questionnaire, all supporting documents giving evidence that the betting is for community benefit. This may include:

• the society’s rules, constitution or other formal document setting out the society’s purposes
• documentary evidence showing that the pool betting is promoted by another person for the benefit of a community society and that the promoter, or totalisator operator is bound to pay all benefits from the betting to that society
• players making bets know that the purpose of the betting is to benefit the society

You must make sure that the documents you send us are still valid.

If we are satisfied that all your pool betting meets the required conditions, we will write and tell you so. We will also stop sending you Pool Betting Duty returns. It is important, therefore, that you act quickly before we issue the next return. The ‘community benefit questionnaire’ will also help us to decide whether we need to visit you in connection with your pool betting business.

You must tell us immediately if the:

• rules of the competition(s)
• terms relating to all benefits from the pool betting that are paid to a community society

change at any time in the future (see paragraphs 5.5 and 5.6 below).

5.3 Can you revoke a permit?

Yes. We may revoke a permit at any time if we believe that it does not relate to:

• the type of business you are operating
• the premises or totalisator you are using

We will notify you in writing if we are revoking your permit.

5.4 How do I notify you of my business premises?

As well as completing the application for a permit (form BD2), you must also notify us of any premises or totalisator that you use for pool betting purposes. This is a legal requirement and is known as ‘making entry’ of the premises. There is a special form to use:

• form EX 103A Excise Entry: Incorporated Company if you are a body corporate
• form EX 103 Excise Entry: Private Trader in any other case

You can download these forms from the HMRC website or contact the Excise Helpline, Telephone: 0300 200 3700. You must return the completed form to the NRU (see paragraph 5.1) no later than the date you first use the premises or totalisator for the purposes of the business.

5.5 Do I need to tell you if I change legal entity or move premises?

Yes, your permit only covers the person and premises or totalisator stated on it. Therefore, if the legal entity of the business changes or you move premises, you must have a new permit.

You will need to complete a new permit application form (BD2) and ‘entry’ form EX 103 or EX 103A as appropriate. You must return the completed form(s) to the NRU no later than the date when the change takes effect.

5.6 Do I have to tell you if my pool betting business is no longer for community benefit?

Yes. If the pool betting you promote, or operate through a totalisator is no longer for community benefit, you will need to start completing Pool Betting Duty returns.

You must therefore write to the NRU no later than 7 days before starting any dutiable pool betting. This allows us to make the necessary arrangements to issue you with duty returns. Please provide full details of all the proposed changes.

5.7 Do I need to tell any other authorities of my intention to promote or operate pool betting?

Our permits do not replace, and should not be confused with any permit or licence under the Gambling Act 2005. You will need to contact the Gambling Commission or your local licensing authority to see what requirements apply to your business.

5.8 What happens if I ‘Fail to Notify’?

You could be charged a penalty if you fail to apply for a pool betting permit or notify HMRC of any business changes at the right time.

This new penalty regime applies when the obligation to notify arises on or after 1 April 2010.

For further information on the failure to notify penalty please see Briefing on new tax penalties on the National Archives website.

6. How to calculate your net pool betting receipts

6.1 What are my net pool betting receipts?

It is the balance remaining after adding stakes, expenses and profits, then deducting any winnings paid out (see paragraph 2.1). This final figure is used to work out the correct amount of Pool Betting Duty that you must pay in an accounting period.

6.2 How do I calculate stake money?

For the purposes of the net pool betting receipts calculation, ‘stakes’ include:

• any payment due to you which entitles a player to make a bet
• unless you can show that the payments have no connection with the betting, all payments due from the player in connection with any bet

You must include as stakes all amounts, which the player pays to make a bet, regardless of how you describe the payments, (for example, as stake money, a subscription, or an administration fee).

You must not reduce the value of stakes by any:

• expenses met from payments made by the players, for example, commission allowed to your agents or collectors
• part of the players’ payments, for example where it is donated to charity or to a sporting society - this applies even if the player knows when making the payment, that a specific amount or percentage will go to such a cause

6.3 When do stakes fall due?

The time when you must account for stakes, for the purpose of your net pool betting receipts calculation, depends on when the event takes place to which the stakes relate, as follows:

• if the bet relates to either a single event, or 2 or more events, which take place on the same day, the stakes are treated as falling due on the day on which the event or events take place
• in any other case, the stakes are treated as falling due when the bet is made

For example, in the traditional football pools competition, entries can be made week-by-week, or by a standing forecast for a number of weeks. As the bet (or bets) relate to a number of matches being played on the same day, the stakes attributable to each particular bet will fall due on the day the matches are played.

If however, a player makes an advance payment to cover a whole season’s games that payment will need to be apportioned so that the stakes only fall due on the days the events betted on take place.

In other competitions where the result depends on the outcome of a series of events over a period of time, (for example, in a fantasy football-type competition), the stakes are treated as falling due when the initial bet is made. Any additional payments made throughout the time the competition is running (for example, to vary the initial selection) are, treated as stakes, and the transactions as bets. These stakes are treated as falling due when that bet is made.

Note: the above rules apply regardless of when the stake is actually paid or due to be paid.

6.4 How do I calculate expenses and profits?

For the purposes of your net pool betting receipts calculation, ‘expenses and profits’ are your expenses and profits, and those of any other person concerned with or benefiting from the promotion of the betting.

This includes any promotion or management expenses connected with running your pool betting business, (such as advertising, premises and staff costs, telephone charges or the cost of setting up a third party server).

It does not, however, include any expenses and profits which:

• are already met out of stake money
• relate to other matters or activities that are not connected with the promotion or management of your betting business (for example, an independent trader’s ordinary business profits obtained through supplying you with goods and services)

For example, as well as the £1 entry fee to a pool betting competition, a person has to pay an extra 10 pence to cover the costs of processing the entry. You must include the extra 10 pence in your net pool betting receipts calculation.

If you offer a prize of goods given to you by a supplier as part of a promotional exercise you must include the value of the goods as a taxable expense.

6.5 How do I calculate winnings?

For the purposes of your net pool betting receipts calculation, you must only include payments of money as winnings. This also includes the return of stake money to your customers in respect of their dutiable pool bets. Make sure you only include winnings in your net pool betting receipts calculation, in the accounting period in which they are actually paid out. You cannot include in your calculation any winnings not yet paid out to, or collected by, your customers.

6.5.1 Customer’s accounts

Only include customer’s winnings in your calculation from the date you notify them that you have credited their accounts and that they are available for withdrawal. Normally the issue of a statement to your customers will create this date. However, there may be occasions where you can show that they were notified earlier. If so, you are entitled to include the winning amounts in your calculation from the earlier date.

Note: a telephone line that is made available to customers who wish to check the status of their accounts, is not considered suitable notification. Telephone facilities may only be used for this purpose, if you can prove that you personally advised the customer of his winnings.

6.5.2 Non-cash prizes

Only cash prizes can be included in your winnings. Non-cash prizes must not be included as winnings.

If you offer non-cash prizes, and their cost was not met out of stake money, you must add the value of this expense to your total stakes before making your net pool betting receipts calculation.

6.6 What is the minimum duty liability in an accounting period?

If in an accounting period, your net pool betting receipts from dutiable pool bets (as explained in paragraph 2.2) are zero or a negative figure, then you do not have to pay any duty in that period.

7. How to calculate the duty

7.1 What is an accounting period?

It is a 4 or 5 week period ending on the last Saturday in each calendar month. However, we are introducing changes from 26 September 2010. That means, if you meet the eligibility criteria at paragraph 7.3 you will be able to adopt a quarterly accounting period and duty return.

7.2 Who can apply for quarterly accounting periods?

You can give notice that you wish to adopt a 3 monthly accounting period if you meet the specific conditions listed in paragraph 7.3 below.

7.3 What conditions apply to quarterly accounting?

You can give notice if in the 12 months immediately preceding the date of your notice, the aggregate of the amounts that were due to you in respect of dutiable pool bets did not exceed £660,000.

You cannot give notice if in the 12 months immediately before the date of your notice ,you have been convicted of an offence under paragraph 13(3) of Schedule 1 of the Betting and Gaming Duties Act 1981 that is connected with Pool Betting Duty or General Betting Duty involving:

• making, or recklessly making a statement which you know to be false
• with intent to deceive, producing or making use of any book, account, record, or other document which is false
• you have failed to furnish any return required in the 12 months immediately before the date of your notice
• any duty due is outstanding at the time of your notice, unless you have a Time to Pay agreement with us and you have made all your payments on time

7.4 How do I apply?

If you meet all the conditions in paragraph 7.3 above and wish to have 3 month accounting periods, you must give us notice in writing at least 28 days before the day on which the 3 month period is to start. You must quote your pool betting permit serial number on all correspondence.

Your notice must:

• include the first calendar month of that period
• state the consecutive periods, each comprising of 3 months that will become your accounting periods

Send your written application and a copy of your time to pay agreement (if you have one) to the Cumbernauld Accounting Team (CAT) at the following address:

HMRC Banking
St Mungo's Road
Cumbernauld
Glasgow
G70 5WY

CAT will confirm your accounting periods and tell you when they will send you your first quarterly return for completion.

Once you begin using quarterly accounting periods, you must continue making 3 monthly returns for at least 12 months, unless for a specific reason we tell you to go back to monthly returns.

7.5 When must I adopt monthly returns?

You will have to adopt monthly returns if:

• in the 12 months immediately before the end of any 3-month accounting period, the aggregate of the amounts that were due to you in respect of dutiable pool bets exceeds £825,000
• you are convicted of any Pool Betting Duty or General Betting Duty offence listed at paragraph 7.3
• you fail to furnish a return by the due date
• you fail to pay any duty due as required, then each calendar month following the accounting period in which you were convicted, or in respect of which failure occurred becomes an accounting period

8. How to calculate the duty

8.1 How do I work out how much duty to pay?

You work out the amount of duty due in each accounting period by:

• adding together all your stakes (see paragraph 6.2) and expenses and profits (see paragraph 6.4)
• deducting all winnings paid out to players (see paragraph 6.5), including any carry-forward of losses included on previous returns (see paragraph 8.2)
• calculating 15% (current rate of Pool Betting Duty) on the balance (your net pool betting receipts)

After taking into account any adjustments, such as under-declarations (see paragraph 9.4), you must pay this amount to us on your monthly duty return (see paragraph 9.6).

8.2 Can I carry forward negative net pool betting receipts (losses)?

Yes, you can carry any negative net pool betting receipts amount from one accounting period into the next accounting period.

For example, if in an accounting period, your net pool betting receipts calculation produces a sum of minus £20,000. You need to enter (£20,000) in boxes 3 and 5 of form BD1 Pool Betting Duty Return. Your duty liability for that period is shown as ‘NIL’ in box 6. On the next duty return, you should show the £20,000 carried forward from the first period in box 4 and deduct it from the net pool betting receipts shown in box 3. See example in paragraph 8.3 below.

8.3 What if my negative net pool betting receipts carried forward exceed the net pool betting receipts in the next period?

If in that next period you do not make sufficient profit in your pool betting activities to fully offset the ‘loss’ carried forward, you can carry the balance of the ‘loss’ over into the following period.

For example, in the second accounting period your net pool betting receipts calculation shows only £15,000 in box 3. Your net amount for duty calculation in that period will show (£5,000), which is £15,000 minus £20,000. Your duty liability will be NIL, and you will have a £5,000 ‘loss’ to carry forward to the next accounting period.

Carry forward of losses

	Period 1	Period 2
Amount due for dutiable bets	£100,000	£115,000
Amount paid as winnings	£120,000	£100,000
Net pool betting receipts	(£20,000)	£15,000
Losses carried forward from previous period	Nil	£ 20,000
Net amount for duty calculation	(£20,000)	(£5,000)
Duty due	Nil	Nil

8.4 What if I cease trading with a negative net pool betting receipts figure in my last trading period?

There is no provision to repay any ‘unused’ loss carried forward. This means that if your business ceases to trade and shows negative net stakes receipts in its final accounting period, you cannot claim any repayment or refund for that amount.

9. How to pay the duty

9.1 Who is responsible for paying the duty?

The promoter or operator of a totalisator for the pool betting must pay the duty. If he fails to do so, we may also recover duty from:

• a person responsible for managing any business where any pool bets were made
• a director, if the business is a company

9.2 Who supplies my returns?

The CAT will automatically send you form BD1 Pool Betting Duty Return. Returns are normally issued about 2 weeks before the end of each accounting period. If you lose, or do not receive your return, you can download a copy from the HMRC website, or call the Excise Helpline on Telephone: 0300 200 3700 for a replacement immediately. Remember, only the person named on the return can use it.

9.3 How do I fill in my return?

You must:

• make sure that you only use the return for the stated accounting period
• read the notes on the reverse of the form
• make all entries in ink
• read and sign the declaration

For example:

Pool Betting Duty Return

Box		£
1	Total amounts due to you for dutiable bets (stakes plus expenses and profits not met out of stake money).	150,000
2	Total value of money paid by you as winnings (include any amounts returned as void bets - see paragraph 4.6).	100,000
3	Net pool betting receipts (box 1 minus box 2).	50,000
4	Losses carried forward from previous period (if no losses show nil - see paragraph 8.2).	20,000
5	Net amount for duty calculation (box 3 minus box 4).	30,000
6	Duty due (box 5 multiplied by the duty rate - currently 15%).	4,500
7	Add any under-declarations of duty from earlier accounting periods (see paragraph 9. below).	0
8	Net duty due to Customs (box 6 plus box 7).	4,500

For any duty over-declarations made on previous returns, you will need to follow the directions at paragraph 9.5 below).

9.4 What if I have under-declared duty on a return?

If you have made an error on a previous return, which means you did not pay us enough duty, you should make an adjustment in box 7 on your next return. Make sure you retain sufficient documentation to provide a satisfactory audit trail, in case we ask you to explain the adjustment (but see Important note in paragraph 9.5 below).

Do not include in box 7 any under-declarations that we have notified to you on form EX 601, for example, following a visit by our officer(s).

9.5 What if I have overdeclared duty on a return?

If you have made an error on a previous return, which means you paid us too much duty, you will need to make a claim in writing to the CAT (see paragraph 9.7). For example, this could occur if you omitted to include a loss from an earlier period. See Notice 212: statutory interest and repayment of overpaid excise duty, for further information.

9.6 How do I pay the duty?

We accept payment by a range of methods but recommend that you use one of the following options:

• Bacs Direct credit
• internet/Telephone banking
• CHAPS

You will need to supply your bank or building society with the following details:
- sort code: 08-32-00
- account number: 12000911
- account name: HMRC GACA
- payment amount
- your pool betting reference number (this must include the prefix ‘PB’)
(Note: your reference number is made up of 9 digits which you should find at the top of your duty return, when providing your reference please show it in the format PB/reference, for example PB/12345678 (this reference is only an example and should not be used to make a payment)

• by post - if you are unable to pay by any of the options shown above, you should send your cheque with your duty return to the address below.

Cheques should be made payable to ‘HM Revenue and Customs only’ followed by your pool betting reference number.

If you do not have a pre-addressed envelope that we sent you, please send your payment to:

HMRC Banking
St Mungo's Road
Cumbernauld
Glasgow
G70 5WY

Whatever payment method you use, you must make sure you have sufficient funds in your account to satisfy payment.

Note: if you ever make payment without a return or remittance document, please make sure that you endorse it with your pool betting reference number and the reason for the payment.

For further information and additional options on How to pay Pool Betting Duty see the HMRC website.

9.7 When and where must I send my return and payment?

Your completed form BD1 Pool Betting Duty Return, and full payment of duty, must reach CAT no later than the ‘due date’ shown on your duty return form and in the boxed paragraph below.

This following direction has the force of law under paragraph 3, Schedule 1 of the Betting and Gaming Act 1981.

Pool Betting Duty must be paid to the Commissioners no later than the 15th day of the month following the end of the accounting period.

If the 15th day following the end of the accounting period is a Saturday, Sunday or bank holiday, the return and payment must reach us by the previous working day. You must send your return to:

Cumbernauld Accounting Team
HM Revenue and Customs
St Mungo’s Road
Cumbernauld
Glasgow
G70 5WY

Important note: you may be liable to a penalty if you do not send your completed return and payment by the ‘due date’.

We usually include a pre-addressed envelope for your use when sending back your return.

If you have not promoted, or operated a totalisator for pool betting during the accounting period, you must send a nil return for that period.

9.8 What happens if I have made a mistake on a return?

You could be charged a penalty if don’t take reasonable care with your tax affairs.

We can charge a penalty if your return or other tax document is inaccurate and as a result you don’t pay enough duty, or if you don’t tell us a duty assessment we have sent to you is too low.

This new penalty regime applies to return periods commencing on or after 1 April 2009 where the return is due on or after 1 April 2010.

For further information on the inaccuracy penalty please see the National Archive website.

9.9 How can I avoid a penalty?

You can avoid a financial penalty by checking that you have given complete and accurate information in your return.

If you are aware you have made a mistake on your return, please tell us as soon as possible. We will be able to reduce the penalty, in many cases to zero.

You have the right to appeal if we impose such a penalty.

For further information on penalties please see the National Archive website.

For further information on appeals please see How to appeal against an HMRC decision - indirect tax on the HMRC website.

10. Records

10.1 Do I have a legal responsibility to keep records?

Yes, if you promote or operate a totalisator for pool betting that is chargeable with Pool Betting Duty, you must keep the accounts and records necessary to:

• work out the net pool betting receipts
• enable us to check the duty due

The requirements described in this section apply specifically for Pool Betting Duty purposes. There are separate record keeping rules that apply for VAT purposes. You can find out more about these in Notices 700 The VAT Guide and Notice 701/26 Betting and gaming.

If you are registered for VAT, your records may contain information that we also require for Pool Betting Duty purposes, for example, ‘Spot the ball’ competitions - see paragraph 4.1. Providing your records are cross-referenced and the audit trail is clear and easy to follow, we would not expect you to duplicate your records.

10.2 Where do I have to keep my records?

You must keep all books, accounts and returns connected with your business at the premises for which you have ‘made entry’ under paragraph 5.4.

10.3 Do you have the right to see my records and accounts?

Yes, we have the legal right to see and take copies of any records, accounts or other documents relating to your business. You must keep your records in a readily accessible format and must produce them to our officers when asked.

10.4 What if I keep my records on computer?

If you want to use a computer for your records, you should first contact us. We will be able to advise you whether the system you propose meets our record keeping requirements.

10.5 What law covers the record keeping requirements?

The Revenue Traders (Accounts and Records) Regulations 1992 gives us the power, under Regulation 6, to specify in a notice:

• the records you must keep
• the time of recording
• how long you must keep the records

The boxed paragraphs in section 10.6 below identify these specified records.

10.6 What records must I keep?

Other than the boxed paragraphs below, we do not specify by law any other records that you must keep. We expect that your normal business records will be sufficient for duty accounting purposes. If, however, we are not satisfied that those records are sufficient to enable you to properly calculate the duty due and allow us to check that amount, we will require you to keep different or additional records.

The following rules have the force of law.

Excise Duty account

Regulation 5 of The Revenue Traders (Accounts and Records) Regulations 1992 provides that a revenue trader must complete an excise duty account at the time he completes a Pool Betting Duty return. It must contain the:

• amount of Pool Betting Duty due for the accounting period (before any adjustment)
• amount of any adjustment made in this period (for previous under-declarations, or carry forward of losses)
• amount after any adjustment, of any duty payable in the accounting period
• date and method of payment of any duty paid

Net pool betting receipts

Regulation 6 of The Revenue Traders (Accounts and Records) Regulations 1992 provides that Customs may specify in a notice which records a revenue trader must keep and preserve.

This account may be incorporated with the Excise Duty Account (see paragraph above) and must contain the following information for each accounting period:

• the gross amount of stake money, (as described in paragraph 6.2)
• the gross amount of expenses and profits attributable to your pool betting, (as described in paragraph 6.4)
• the total amount paid out in winnings, (as described in paragraph 6.5)
• the total net pool betting receipts

Completion of records

Regulation 7 of The Revenue Traders (Accounts and Records) Regulations 1992 provides that a revenue trader must complete all his records at the time of, or as soon as possible after the relevant event, or when the information is first known to him.

Storage of records

A revenue trader must keep the above records for the following periods:

• coupons, entry forms, tickets, etc. - 6 months.
• details of winnings paid out, including winnings notified as payments to customers’ accounts - 6 months after the date when the winnings are paid out

Other records

• documents and accounts - 3 years.

The above rules apply for Pool Betting Duty purposes only. You may have to keep your records for longer periods for other reasons, for example, for HMRC or social law purposes.

11. Legal powers

11.1 What is the law on Pool Betting Duty?

The Customs and Excise Management Act 1979 and the Commissioners for Revenue and Customs Act 2005, provides that the Commissioners of Revenue and Customs are responsible for the care and management of the revenues which includes Pool Betting Duty.

The primary law on Pool Betting Duty is contained in the Betting and Gaming Duties Act 1981. This law also gives the Commissioners power to make directions, for example the date when you must pay Pool Betting Duty.

Current directions are shown in this notice and are contained in a box for ease of identification.

Section 10 contains all record keeping requirements.

11.2 What other legal powers do HMRC have?

Our officers have a responsibility, both to the Exchequer and to compliant taxpayers, to make sure that duty is accounted for correctly. We will do this by occasional visits to your premises to look at your records, accounting systems and business, or by contacting you for additional information. Our officers will normally make an appointment to visit you. However, we may also make unannounced visits to make sure that you are complying with the duty requirements.

There are also a number of provisions in law that are designed to enable us to check the duty more effectively. These include the power to:

• issue an assessment where you have under-declared duty or you have not submitted a return
• enter any premises used for the purposes of a pool betting business, or where our officer has reasonable cause to suspect that a pool betting business has been, or is being, promoted or operated through a totalisator
• remain on those premises while our officer has reasonable cause to suspect that you may use the premises for the purposes of carrying on the business
• tell you what records and accounts to keep
• require any person concerned with the management of the premises or any promoter, to provide information about the pool betting
• inspect records relating to your business that we have directed you to keep and any other books, records, accounts or other documents including your business bank accounts and annual accounts
• take copies of any books, records, accounts or other documents relating to Pool Betting Duty, and
• require you to give any information and assistance our officer may request

11.3 What provisions may attract civil penalties?

We may apply civil penalties to a range of circumstances under section 9 of the Finance Act 1994.

These include failure to:

• notify your pool betting business or any relevant changes
• submit duty returns
• pay any duty due

Notice 209 Civil Penalties: fixed, geared and daily gives more information on this subject.

For serious offences, such as:

• fraudulent evasion of duty
• promoting pool betting chargeable with Pool Betting Duty without having a permit with us
• making false declarations or returns
• obstructing our officers

you may be liable to severe penalties, including imprisonment.

It is therefore important that you call the Excise Helpline on Telephone: 0300 200 3700 if there is anything you do not understand or are not sure of.

11.4 What if I fail to pay duty that is due?

If you fail to pay the Pool Betting Duty due, whether in full or in part, we may order civil proceedings to recover the debt.

In serious cases, we may apply to the Gambling Commission to ‘review’ your pool betting operating licence.

12. Reviews and appeals

12.1 Can I appeal against decisions made by HMRC?

Yes, you have the right to ask us for a review, or appeal directly to an independent tax tribunal, on certain decisions we make about your business. Some of these include:

• a person’s liability to an assessed amount of duty
• a person’s liability to pay an assessed amount of duty
• the issue of civil penalties

If you do not agree with a decision, you can:

• ask for it to be reviewed by an HMRC officer not previously involved in the matter
• appeal to an independent tribunal

If you choose to have a decision reviewed you can still appeal to the tribunal after the review has finished.

12.2 Is there a time limit to ask for a review or an appeal?

Yes, if you want us to review a decision, you must write to the person who issued the decision letter within 30 days from the date of that letter. We will complete our review within 45 days, unless we agree another time with you. We will not take any action to collect the disputed tax while the review is being carried out.

If you want to appeal to the tribunal you should send them your appeal within 30 days of the date of the decision letter.

12.3 What must I include in my appeal letter?

Your written request should set out clearly the full details of your case, the reasons why you disagree with us and provide any supporting documentation. You should also state what result you expect from our review.

12.4 Where can I get more information?

You can find further information about appeals and reviews on the HMRC website or download a copy of Factsheet HMRC1: HM Revenue and Customs decisions - what to do if you disagree (PDF, 45K) by using the links provided or call the Excise Helpline on Telephone: 0300 200 3700.

If you want to find out more about the Tribunals Service, visit their website or you can call them on Telephone: 0845 223 8080.

13. Glossary

Term	Description
Accounting period	A 4 or 5 week period ending on the last Saturday in each calendar month.
Community benefit	Any bets made for community benefit are not ‘dutiable pool bets’. To be eligible for community benefit, the promoter must pay all benefits received from pool betting to a ‘community society’ (see definition below).
Community society	A society established and conducted for charitable purposes, or mainly for the support of athletic sports or games and not for private gain.
Dutiable pool bets	Dutiable pool bets are made by way of pool betting with either a promoter or totalisator in the UK. Bets do not apply when: * made wholly in relation to horse racing or dog racing * through community benefit.
Expenses and profits	Costs connected with the promotion or management of the pool betting, but not if met out of stake money.
Fantasy football competition	Liable to Pool Betting Duty where competition rules have an entry fee and prizes.
Fixed odds betting	Where each bettor knows at the time of the bet what he will win.
CAT	Cumbernauld Accounting Team.
Helpline	Excise Helpline, Telephone: 0300 200 3700.
‘Make entry’	A legal requirement to notify Revenue and Customs of the premises used for pool betting purposes. Forms EX 103/103A apply.
Net pool betting receipts	This is the balance remaining after adding together all stakes, expenses and profits, then deducting total winnings paid out in an accounting period.
Operator	A person responsible for the management of any totalisator in the UK used for pool betting purposes.
Pool betting	Bets are made, other than at fixed odds and where the total winnings are shared with all other winners in the pool. The ratio of winnings paid out is determined by the amount of the bet originally made.
Pool Betting Duty	Duty charged at the rate of 15% on a promoter’s or totalisator operator’s net pool betting receipts in an accounting period.
Premises	The premises used in connection with a pool betting business or where a totalisator operates.
Promoter	A person responsible for the management of any pool betting business and the calculation of the net pool betting receipts in an accounting period.
Spot the ball competition	Is not pool betting, as it is based on a past event where the result is not generally known and a panel of judges decides a competition.
Stakes	All payments made on account of dutiable pool bets.
Totalisator	A machine or instrument used for pool betting calculations, whether mechanically operated or not.
Winnings	Is the aggregate amount paid out as winnings on dutiable pool bets to all winners in an accounting period.

Your rights and obligations

Your Charter explains what you can expect from us and what we can expect from you. For more information go to Your Charter.

Do you have any comments or suggestions?

If you have any comments or suggestions to make about this notice, please write to:

HM Revenue and Customs
Gambling Duties Team
Excise, Customs, Stamps and Money
3W, Ralli Quays
3 Stanley Street
Salford
M60 9LA

Please note this address is not for general enquiries. For your general enquiries please call our Helpline Telephone: 0300 200 3700.

Putting things right

If you are not satisfied with our service, please let the person dealing with your affairs know what is wrong. We will work as quickly as possible to put things right and settle your complaint. If you are still unhappy, ask for your complaint to be referred to the Complaints Manager.

For more information about our complaints procedures go to www.hmrc.gov.uk and under quick links select Complaints.

How we use your information

HMRC is a Data Controller under the Data Protection Act 1998. We hold information for the purposes specified in our notification to the Information Commissioner, including the assessment and collection of tax and duties, the payment of benefits and the prevention and detection of crime, and may use this information for any of them.

We may get information about you from others, or we may give information to them. If we do, it will only be as the law permits to:

• check the accuracy of information
• prevent or detect crime
• protect public funds

We may check information we receive about you with what is already in our records. This can include information provided by you, as well as by others, such as other government departments or agencies and overseas tax and customs authorities. We will not give information to anyone outside HMRC unless the law permits us to do so. For more information go to www.hmrc.gov.uk and look for Data Protection Act within the Search facility.