Statement of Practice E14
Published 16 September 1977
© Crown copyright 1977
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No liability to Inheritance Tax (IHT) arises on winnings by a football pool, National Lottery or similar syndicate provided that the winnings are paid out in accordance with the terms of an agreement drawn up before the win.
Where for example football winnings are paid out, in accordance with a pre-existing enforceable arrangement, among the members of a syndicate in proportion to the share of the stake money each has provided, each member of the syndicate receives what already belongs to them. There is therefore no ‘gift’ or ‘chargeable transfer’ by the person who, on behalf of the members, receives the winnings from the pools promoter.
Members of a pool syndicate may think it wise to record in a written, signed and dated statement, the existence and terms of the agreement between them. But HM Revenue and Customs cannot advise on the wording or legal effect of such a statement, nor do they wish copies of such statements to be sent to them for approval or registration. Where following a pools win the terms of an agreement are varied or part of the winnings are distributed to persons who are not members of the syndicate, an IHT liability may be incurred. The same principles apply to premium bonds syndicates and other similar arrangements.
First publication
Revenue press release dated 16 September 1977.