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HMRC internal manual

Machine Games Duty

Operational: Compliance checks: types of machine/rate of duty

A machine game is dutiable if it is possible to win a cash prize which is greater than the cost of each individual play. This includes quiz machines which offer a cash prize greater than the cost of play and ‘mixed’ machines where dutiable and non-dutiable games can be played.

The machine games may be games of chance or games of skill. What determines the type of machines and the rate of duty payable is the cost to play and the maximum cash prize.

There are three rates of Machine Games Duty chargeable on three types of machine games.

*Type 1: to qualify as a Type 1 machine, it must be demonstrated that:

  • the cost to play each dutiable machine game on the machine once does not exceed 20p, and
  • the maximun cash prize for each dutiable machine game on the machine does not exceed £10.

*Type 2: to qualify as a Type 2 machine, it must be demonstrated that:

  • it is not a Type 1 machine, and
  • the cost to play each dutiable machine game on the machine once does not exceed £5.

*Type 3: are all machines that do not qualify as Type 1 or Type 2 machines.

If a machine offers a mix of these types of machine games, everything is liable at whichever is the highest duty rate.

*Amended by Section 124 of the Finance Act 2014, which came into force on 1 March 2015.