Gambling Tax Reform: rules from 1 December 2014
Find out about Gambling Tax Reform, how it affects you and what you should do if you need to register.
Overview
This guide is about General Betting Duty (GBD), Pool Betting Duty (PBD) and Remote Gaming Duty (RGD).
The rules for these taxes changed from 1 December 2014.
This guide gives details of the key changes and what you need to do if the changes affect your business.
These taxes may affect you if:
- you offer betting and/or gaming from outside the UK to gamblers in the UK - for example, over the internet
- you offer betting from a UK shop or are a spread betting provider
Other types of gambling are covered by other taxes, for example:
- bingo in a bingo hall is subject to Bingo Duty
- gambling in a casino is subject to Gaming Duty
These taxes are covered by separate guides.
GBD, PBD and RGD from 1 December 2014
Up to and including 30 November 2014 these taxes were taxed on a ‘place of supply’ basis.
This means that if you’re supplying gambling from the UK, you pay tax on all your gross gambling profits. Operators supplying UK customers from outside the UK pay no UK gambling taxes.
From 1 December 2014, HM Revenue and Customs (HMRC) changed how these gambling duties were taxed from ‘place of supply’ to ‘place of consumption’.
This means that if you offer remote gambling to a person who usually lives in the UK, you’re liable to one or more of the taxes (GBD, PBD or RGD). This applies no matter where in the world you’re based.
Therefore, from 1 December 2014 UK based operators who supply remote gambling to customers who don’t usually live in the UK are no longer liable to GBD, PBD or RGD on those transactions.
If you’re a bookmaker offering bets from a shop in the UK or a spread betting provider, the changes don’t make any difference to what you pay, but there are some administrative changes.
GBD
From 1 December 2014, GBD is charged on a bookmaker’s profits for:
- general bets or pool bets on horse racing or dog racing, where the bets are made with a bookmaker by a customer who’s present in a betting shop, regardless of where the customer usually lives
- spread bets - that’s betting on the outcome of financial or non-financial fluctuations of an index, where the bets are made with a bookmaker who’s in the UK
- general bets or pool bets on horse racing or dog racing made with a bookmaker (not in a UK betting shop) by a UK person, regardless of where in the world the bookmaker is located
On-course only bookmakers remain exempt from GBD and the requirement to tell HMRC about their business has been abolished. However, as before, on-course only bookmakers need to register for and pay GBD on any off-course bets they take in the course of their business.
PBD
PBD is charged on a bookmaker’s profits from bets that are not at fixed-odds and are not on horse or dog racing, where the customer is:
- present in a UK betting shop, regardless of where the customer usually lives
- a UK person, regardless of where in the world the customer is located
Bets not at fixed-odds or on horse or dog racing may be subject to GBD.
RGD
RGD is charged on a gaming provider’s profits from remote gaming played by a UK person. A gaming provider is the person with whom the player has a contract (or similar arrangement) for play.
Register for GBD, PBD and RGD
If you’re liable to GBD, PBD or RGD for the first time on or after 1 December 2014, you must register for the appropriate tax, submit returns and pay any tax due in sterling.
For multiple taxes you must register in one single transaction using the GTS online registration service.
If you don’t hold (and are not required to hold) a Remote Operating Licence (ROL) from the Gambling Commission (GC), HMRC can send you paper registration forms.
You can ask for the appropriate form by writing to:
HMRC National Registration Unit
Portcullis House
21 India Street
Glasgow
G2 4PZ
If you were liable to GBD, PBD or RGD before 1 December 2014
HMRC has written to you about the changes and about moving you to the new system. This letter asked you to provide some additional information.
Following your reply, you were issued with a ‘registration certificate’ including a new reference number for each tax that you’re registered for.
If you haven‘t replied to the letter, you need to do so straight away so that HMRC can move you to the new system.
Register for more than one tax
If you’re liable to more than one tax you’ll need to make a separate registration application for each tax. This is because in law each tax is a separate tax.
For example, a bookmaker offering fixed-odds and pool betting may be liable to GBD and PBD and will have to make a separate registration application for each tax.
GTS makes this easy for you. It guides you through the separate registration applications and copies information between these applications so that you don’t need to enter the same information again.
You can apply to register for all of the taxes that are relevant to you in a single GTS session.
It’s important to note that currently, if you don’t apply to register for all of the taxes that are relevant to you in a single GTS session – for example, you apply to register for one tax and log out of the system before returning to apply to register for an additional tax – you’ll not be able to do so.
If you’ve applied to register for one tax and need to register for another, but have closed your initial registration session you’ll need to write to HMRC about any subsequent registrations at:
HMRC National Registration Unit
Portcullis House
21 India Street
Glasgow
G2 4PZ
HMRC intend to make improvements to GTS in future IT releases.
You can use the GTS online registration system to register for:
- GBD
- PBD
- RGD
Find more in the Gambling Tax registration guide.
Groups
A group is a number of corporate bodies under common control. A separate registration is needed to form a group for each tax.
A group only submits 1 return for each accounting period to cover all group members. All group members have joint and several liability for each other’s duty.
Each group must have a Group Lead Member (GLM) and that GLM must have a principal place of business in the UK.
When a group has been formed no group member will need to appoint a representative.
Representatives
If you have a liability to GBD, PBD or RGD and you aren’t in a group you’ll need to appoint an HMRC approved representative in the UK unless you’re based in:
- the EU
- the UK (businesses based in the Channel Islands will need to appoint a representative)
- Norway, the Faroes, Iceland, New Zealand or South Africa
- in a jurisdiction which has an agreement in place with the UK to enforce gambling tax debts on behalf of the UK - such agreements are in place with Gibraltar and the Isle of Man
If you need to appoint a representative you’ll be asked to nominate one during the online registration application process.
HMRC will contact the nominated representative who’ll be asked to complete a ‘Gambling Tax - Representative Details’ form (GTRA1). Nominated representatives must also supply HMRC with their current year financial statement.
Within 3 weeks, HMRC will let you know when they’ve contacted your nominated representative and will tell the representative and you of approval. If approval isn’t possible, HMRC will discuss this with you.
HMRC won’t complete the registration process until they’ve approved your representative.
Find more about appointing representatives and providing security.
Agents
If you want someone such as an accountant or other agent to act for you, you can appoint them when applying to register online.
Make changes to your registration
You must tell HMRC about any changes or inaccuracies in the information you gave on your application for registration within 1 month of the date of registration, or within 1 month of the changes or inaccuracies happening (whichever is the later). Changes you need to tell HMRC about include:
- a change to business type
- a change of name or address
- changes to authorised signatories
- opening or closing a business
- ceasing to trade
- adding an agent
- register for another tax
Deregistration
If you want to deregister either as an individual or group, you can tell HMRC in writing, 14 days before the event. You must include:
- your GBD, PBD or RGD registration number
- the date you want the deregistration to take effect
- confirmation that your GBD, PBD or RGD activities have stopped
You should write to this address if you want to report any changes or if you want to deregister:
HMRC National Registration Unit
Portcullis House
21 India Street
Glasgow
G2 4PZ
Returns and payments
You must submit a return for each type of gambling tax you’ve registered for. HMRC don’t expect returns to be available before 31 March 2015.
Your return, which you can fill in online, must be with HMRC by the 30th day after the end of each accounting period. If the 30th day falls on a weekend or bank holiday, your return and payment must be with HMRC by the end of the previous working day.
You have 4 accounting periods a year.
You must make a return even if you don’t owe any tax for the accounting period.
Operators liable before 1 December 2014 - final return under the old rules
If you were liable before 1 December 2014, HMRC sent you a return for the period up to and including 30 November 2014. This was due by 30 December 2014.
If you were on monthly accounting periods before 1 December 2014, you’ll now be on quarterly periods and HMRC has written to you about this.
HMRC has set your first accounting period to end on 31 March 2015. This means your first return and payment for the period to 31 March 2015 is due by 30 April 2015.
If you weren’t expecting your first accounting period to end on 31 March because you asked for something else when you applied to register, you’ll receive a letter from HMRC. This will explain the accounting period end dates you’ll have after 31 March 2015.
If you asked for non-standard tax periods, HMRC may be able to offer you a first accounting period end date between 15 March 2015 and 16 April 2015.
What you’ll need to complete your GBD return
If you’ve registered for GBD there are 3 separate sections of the return. You’ll need to complete the sections that are relevant to you – if you’re filling an online return you’ll only see the relevant sections.
The different sections of the return are:
- off-course betting
- betting exchange
- spread betting
The off-course betting section of the GBD return
To complete this section of your return you’ll need:
- the number of betting shops you have in the UK – this may be the same as when you registered or may be different
- any amounts due to the business for taxable bets
- the amounts paid by the business as winnings in respect of taxable bets
- any negative profits from a previous return
- any under declared tax from previous return periods
The spread betting section of the GBD return
For financial and other spread bets you’ll need:
- your profits in period on which tax is due
- negative profits on which tax is due
- negative profits from a previous return
- any under declared tax from previous return periods
The betting exchange commission section of the GBD return
For this section of your return, you’ll need:
- commission charges liable to tax
- tax payable before adjustments
- any under declared tax from previous return periods
You’ll be able to work out how much tax to pay using the information above.
What you’ll need to complete your PBD and RGD returns
For your PBD and RGD returns you’ll need:
- profits in period on which tax is due
- negative profits in period for which tax is due
- negative profits from a previous return period
- any under declared tax from previous returns
This will enable you to work out how much to pay.
Pay GBD, PBD and RGD
HMRC recommends that you pay electronically by:
- Bacs Direct Credit
- Faster Payments by online or telephone banking
- CHAPS
If you can’t pay using one of the electronic methods listed above, you can send a cheque, in sterling, to be drawn on a UK bank. You should allow at least 3 working days for your payment to reach HMRC from the UK - you’ll need to allow longer if the cheque isn’t sent from the UK. This allows for any delays in the post outside HMRC’s control.
Payments from outside the UK can be made by transferring funds electronically from an overseas bank through the SWIFT banking system. This will involve holding an International Bank Account Number and a SWIFT Bank Identifier Code.
Record keeping
You’ll need to keep appropriate records.
GBD
The guidance in section 7 of Notice 451: General Betting Duty (edition April 2010) sets out record-keeping requirements for GBD liabilities before 1 December 2014.
The guidance in section 8 of Notice 451a: General Betting Duty covers record keeping requirements for liabilities after that date.
PBD
The guidance in section 10 of Notice 147: Pool Betting Duty (edition September 2010) sets out record-keeping requirements for PBD liabilities before 1 December 2014.
The guidance in section 9 of Notice 147a:Pool Betting Duty covers record-keeping requirements for liabilities after that date.
RGD
The guidance in section 7 of Notice 455: Remote Gaming Duty (edition April 2010) sets out record-keeping requirements for RGD liabilities before1 December 2014.
The guidance in section 8 of Notice 455a: Remote Gaming Duty covers record keeping requirements for liabilities after that date.
You should keep your records for 4 years as HMRC might ask to see them.
Last updated 15 January 2015 + show all updates
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Update to inform customers that they can register for all the taxes in one single transaction.
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Added separate sections for return periods under old and new rules. Guidance on record keeping added.
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First published.