UK Gambling Tax Reform: Returns Due

UK Gambling Tax Reform: Returns Due

Overseas  based  online  gambling  operators  will  be  aware  that  from  1  December  2014  General
Betting Duty, Pool Betting Duty  and Remote Gaming Duty  in  the UK  are now  taxed on  a place of
consumption basis. For the majority of newly registered eGaming operators with UK customers, the
first reporting period for UK gambling duties will end on 31 March 2015. Returns and any payments
of tax(es) due need to be received by HM Revenue & Customs by no later than 30 April 2015.

There are some key issues for operators to deal with in calculating duty liabilities. The rules are not
the same across each of the gambling duties and operators will need to determine which products
fall within which  duty.  For  example  sports  betting  falls within  the  scope  of General  Betting Duty
whilst slots, casino games and poker are covered by Remote Gaming Duty.

Where operators offer a number of products across multiple jurisdictions the level of complexity can
be  significant.  In  addition,  promotions  are  also  treated  differently  depending  on  the  Duty.  It  is
therefore  important  that operators  consider  carefully  the  impact of  the  rules on  their businesses.
This should help to mitigate any unnecessary exposures to indirect tax in this area.

End of first reporting period for UK Gambling Duties:
31 March 2015

Deadline for submission of return and tax payment:
30 April 2015

Key areas of focus for operators include:

  1. Are  reporting systems and processes sufficiently  robust  to calculate stakes and prizes on a
    product-by-product and player-by-player basis?
     
  2. Promotions – have the rules for each duty been considered in relation to promotions
    including:

    • matched bets
    • enhanced odds
    • free cash
    • progressive jackpots
    • cashbacks
    • free spins
    • guaranteed jackpots
    • refunded losing bets
    • free to enter tournaments
  3. Pooled  games/P2P  games  –  the  effect  of  UK  rules  on  games  played  between  customers
    across multiple jurisdictions
     
  4. The effect of promotional cash in players eWallets pre-1 December 2014

With UK  gambling duties  levied  at 15%  and eGaming operators having high  levels of promotional
expenditure, it is prudent for operators to fully understand the effect and impact of the UK gambling
tax rules on their respective businesses.

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