Lotteries

What is a lottery?

Also known as draws or raffles, a lottery is often a good way to raise funds for charitable purposes although there are many restrictions covering these activities. Broadly, any distribution of prizes where the participants provide money to obtain the chance to win a prize where no degree of skill or judgement has to be demonstrated is a lottery. No lottery may be conducted for private gain.

Apart from the National Lottery, there are only four types of lottery which are legal:

• Incidental non-commercial lottery
• Private lotteries
• Customer lotteries
• Small society lotteries

In simple terms a lottery is a kind of gambling that has three essential elements:

• Payment is required to participate
• One or more prizes are awarded
• Those prizes are awarded by chance.

In addition, section 14(5) of the Gambling Act states that, for the purpose of these definitions, a process that requires people to exercise skill or judgment or display knowledge is to be treated as relying wholly on chance if:

• the requirement cannot reasonably be expected to prevent a significant proportion of people who participate in the arrangement from receiving a prize
• it cannot reasonably be expected to prevent a significant proportion of people who wish to participate in the arrangement from doing so.

Why run a lottery?

People have a variety of reasons for wanting to run a lottery. They may want to collect money for a good cause such as a charity or help their local sports club buy some equipment or simply to have some fun by running an office sweepstake. Whatever the reason - fundraising or just fun - lotteries are a form of gambling and so there is a need for safeguards and other regulations.

What is a society lottery?

Society lotteries are lotteries promoted for the benefit of a non-commercial society. Such societies are organisations that have distinct aims and objectives and meet the definition of a non-commercial society set out in the Gambling Act. A society is non-commercial if it is established and conducted:

• for charitable purposes
• for the purpose of enabling participation in, or of supporting, sport, athletics or a cultural activity
• for any other non-commercial purpose other than that of private gain.

Societies that run small society lotteries, that is to say lotteries in which no more than £20,000 worth of tickets are put on sale and where the society's total proceeds from lotteries do not exceed £250,000 a year, must register with their licensing authority. Where a small society lottery will exceed either of the monetary limits, it is the responsibility of the society to ensure they apply to the Gambling Commission for a licence, before the limit is exceeded.

The promoting society of a small society lottery must, throughout the period during which the lottery is promoted, be registered with a licensing authority in England and Wales or a licensing board in Scotland.

The societies should be registered with their licensing authority in the area where their principal office is located. If the local authority believes that the society's principal office is situated in another area it should inform the society as soon as possible and if possible inform that other authority.

Ticket information

All tickets in a society lottery registered with a local authority must state:

• the name of the organisation or society that will benefit from the proceeds
• the main prize(s)
• the cost of ticket
• the date and place of the raffle draw
• the promoter - the Chairman and their address
• the serial number - each ticket must have one
• that they are registered under the Gambling Act 2005 Small Society Lotteries with Plymouth City Council

Lotteries that need permission

Small society

• At least 20 per cent of proceeds should be to raise funds
• Over 16s can play
• Society members or nominated fundraisers can run this type of lottery
• There are no limits on time
• You can claim for prizes and costs of up to 80 per cent of sales

Lotteries that don't need permission

Private society

• Should be to raise funds
• Members or guests on the premises can play
• Society members can run this type of lottery
• This type of lottery should be a one-off (no rollovers)
• Members or guests must be on the premises to play
• You can claim for prizes and reasonable running costs

Work

• No profit can be made
• Employees at a single premises only can play
• Any employees can run this type of lottery
• This type of lottery should be a one-off
• No sales or advertisements are allowed off the premises. This type of lottery is limited to a single premises only
• You can claim for prizes and reasonable running costs

Residents

• No profit can be made
• Residents at a single premises only can play
• Any residents can run this type of lottery
• This type of lottery should be a one-off (no rollovers)
• No advertisements are allowed off the premises
• You can claim for prizes and reasonable running costs

Customer

• No profit can be made
• Customers of business can play
• Occupiers of business premises can run this type of lottery
• There must be seven days between lotteries (no rollovers)
• No sales or advertisements are allowed off the premises
• You can claim for prizes and reasonable running costs

Incidental non-commercial

• Should be to raise funds
• Anyone at the event can play
• Anyone can run this type of lottery
• This type of lottery should be a one-off with tickets only sold at the event
• You must be on the premises to play
• You can claim for a maximum of £100 costs

Related documents

For further information on fees and guidance documents in relation to gaming machines and the categories for gaming machines please see the guidance documents page.

Application forms

Please see the application forms page for a list of all the application forms required under the Gambling Act 2003.