Lotteries and small society lotteries

Find out about lotteries and how your society or social club can apply to hold a small lottery.

Definition of a lottery

A lottery is a game where people pay to take part for the chance of winning a prize.

Lotteries can be either 'simple' or 'complex'.

Simple lottery

  • People have to pay to participate
  • One or more prizes are allocated to participants
  • Prizes are allocated wholly by chance

Complex lottery

  • People have to pay to participate
  • One or more prizes are allocated to the participants
  • The prizes are allocated by a series of processes
  • The first of these processes relies wholly on chance

Lotteries do not include 'free draws' and 'prize competitions', this is because they are not controlled under the Gambling Act 2005.

  • A 'free draw' is one where there is no charge to enter
  • 'Prize competitions' depend on skill, judgement or knowledge and do not just rely on chance

Small society lotteries

Small society lotteries can only be run in support of good causes, such as charity fundraising and cannot be run for private or commercial gain.

Ticket sales in a single lottery cannot be more than £20,000. In a calendar year that total must not be more than £250,000.

Small society lotteries must be registered with the local authority in whose area the main office of the society is based.

Other types of lotteries

As well as the small society lottery described above there are other types of lotteries.  These are subject to different rules and are be regulated by different agencies.

The National Lottery

This is the most popular gambling activity in the UK regulated by the National Lottery Commission.

Large lotteries

A lottery is considered large when ticket sales in a single lottery exceed £20,000, or the proceeds of all the lotteries in a calendar year exceeds £250,000. The Gambling Commission issues the operating licence.

Local authority lotteries

These are lotteries operated by local authorities to raise funds for any cause on which they have power to spend money. The Gambling Commission regulates these.

Exempt lotteries

These do not need to be for a good cause and do not have to be run under any licence issued by the Gambling Commission, or require registration. There are three categories of exempt lottery:

  • Incidental lotteries - held at events such as fetes and fairs. All money raised from the lottery goes to purposes that are not for private gain. These lotteries must be run according to the Incidental lotteries - rules and regulations
  • Private society, work or residents' lotteries - where tickets can only be sold to society members, workers in or residents of a premises
  • Customer lotteries - run by business premises selling tickets to customers only
 
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