A lottery is defined as an arrangement where people pay to participate for the chance of winning a prize.
The Gambling Commission has issued a code of practice for lotteries which can be obtained from the Gambling Commission website.
Lotteries fall into three categories depending on the value of the proceeds and who can participate in the lottery:
Large society lotteries
Lotteries with proceeds exceeding £20,000 per lottery or £250,000 in a calendar year are regulated by the Gambling Commission.
Small society lotteries
Lotteries with proceeds of less than £20,000 per lottery or £250,000 in a calendar year. These lotteries must be registered with the local authority.
There are three types of exempt lotteries:
- incidental non-commercial lotteries - held at non-commercial events, where all money raised at the event goes entirely to purposes that are not for private or commercial gain
- private society, work or residents' lotteries - where tickets can only be sold to society members, workers in or residents of premises
- customer lotteries - run by occupiers of business premises selling tickets only to customers on the premises itself. The majority of lotteries conducted at a local level will fall under the incidental non-commercial lottery exemption or they will need to register as a small society lottery.
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