Lotteries
Lotteries are a form of gambling – raffles, tombolas and sweepstakes are all classed as lotteries. The Council (the licensing authority) deals with aspects of small and non-complex lotteries which cannot be run for personal gain. Large and complex lotteries including the National Lottery are regulated by the Gambling Commission.
Lotteries can only be run either to raise money for good causes or for fun but they cannot be run for private or commercial gain.
The Gambling Act 2005 is complex and there are substantial penalties for non-compliance. The Council is unable to help you organise gambling; therefore, you should seek independent legal advice to ensure that the proposed gambling is legal.
Prize competitions and free draws
Prize competitions and free draws are free from control under the Gambling Act 2005. They can be run for commercial or private gain and can be used as a fun way of offering prizes or promoting a product. However, it is easy to cross the boundary and in fact be offering an illegal lottery.
Alcohol offered as a lottery prize
The ‘sale’ of alcohol is not defined in the Licensing Act 2003; therefore, a ‘sale’ can include a number of different types of interactions including alcohol being offered as a prize.
Alcoholic prizes cannot be given to under 18s.
Section 175 Licensing Act 2003 – exemption for raffle, tombola etc.
The giving of a sealed container of alcohol as a prize in a lottery will not be counted as a licensable activity for the purposes of the Licensing Act 2003 if:
- the lottery is promoted as incidental to a bazaar, sale of work, fete, dinner, dance, sporting or athletic events or other entertainment of a similar character;
- after the deduction of all relevant expenses*, none of the proceeds are used for private gain;
- none of the prizes are money prizes;
- the tickets or chances are sold or issued and the result of the draw is announced at the time of, and in the same place as, the entertainment;
- the lottery or draw is not the main inducement to attend the entertainment;
(* the expenses which are ‘relevant’ for the purposes of this section as those incurred in the course of arranging and holding the entertainment, and those in connection with the lottery or draw, including the printing of tickets and buying prizes).
This means that alcohol offered as a prize in an incidental lottery will not need authorisation under the Licensing Act 2003 if the above requirements are met.
Other types of lottery may need to authorisation under the Licensing Act for alcohol prizes. The organiser could give a Temporary Event Notice for the date of the lottery draw. Please see our Temporary Event Notice page for more information.
Which types of lottery can be run without any authorisation?
- Incidental lottery
- Customer lottery
- Work lottery
- Residents’ lottery
- Private Society Lottery
Incidental Lottery
Lotteries held during events do not require authorisation from the Council; this includes tombolas, raffles and sweepstakes.
You can only run an incidental lottery to raise money for charity, not for private gain.
- Tickets must not be sold in advance (to do this you will need to register as a small society lottery if you meet the qualifying criteria);
- Tickets must only be sold at the location of the event and only during the event itself.
Incidental lotteries or raffles can be held at events such as:
- fetes
- fairs
- fundraising dinners
- festivals
The lottery MUST NOT be the main reason for holding the event; it must take place alongside a commercial or non-commercial one-off event.
Tickets can only be sold at the location of the event and whilst the event is taking place. There is no limit on how much you can charge for a ticket, and you can apply discount tickets for multiple purchases, such as buy one get one free.
- You cannot sell tickets online (which includes social media) or in advance of the event;
- You can sell tickets to anyone at the event;
- You must provide physical tickets to those taking part. There are no set requirements for what must be printed on the tickets, as long as you can identify which ones are the winning tickets e.g. you can use cloakroom tickets;
- You can sell tickets for an incidental lottery to children;
- You can take up to a maximum of £100 from your proceeds to cover expenses to run the lottery; e.g. costs for printing tickets or hiring equipment;
- You can take up to a maximum of £500 from proceeds to pay for prizes. Prizes can also be donated, there isn’t a limit on how much donated prizes can cost.
Prizes can’t rollover from one lottery to another.
Announcing the result, you can either do the lottery draw during or after the event. We recommend that you make it clear to participants when you’ll be announcing the result.
Refer to Gambling Commission guidance
Customer Lottery
A customer lottery can be run by a business if the lottery will take place at its physical location or premises. You can only sell tickets to customers when they’re on your premises for business purposes.
It is illegal to make a profit from customer lotteries. All of the money raised by ticket sales must be used to pay for prizes and any expenses for organising the lottery.
Prizes must be under £50 in value.
Customer lotteries cannot be used for fundraising; if a local beauty parlour wants to run a raffle for customers it could use the money to pay for physical prizes or services (like a makeover) up to the value of £50.
Refer to Gambling Commission guidance
Work Lottery
A work lottery can only be run and played by colleagues who work at the same physical location. You can either raise money for good causes or just do the lottery for fun. However, you cannot make a profit (if the lottery is not to raise money for a good cause, proceeds have to be used for prizes).
Example: an office wants to hold a sweepstake for the Grand National; it could either raise money for a good cause or use the proceeds to buy prizes providing the sweepstake didn’t make a profit.
Refer to Gambling Commission guidance
Residents’ Lottery
A residents’ lottery can be run if the person running the lottery and everyone taking part live at the same physical location.
You can either raise money for good causes or just for fun. However, you cannot make a profit. Proceeds must only be used for reasonable expenses and prizes.
Example: a residential care home wants to hold a lottery; it could either raise money for a good cause or use the proceeds to buy prizes providing the lottery didn’t make a profit.
Refer to Gambling Commission guidance
Private Society Lottery
Do you want to run a small lottery for charity, or to raise money for my club or group. A private society lottery can be run for members of your private society. This could be a sports club, community group or other type of community organisation.
A private society can be any group or society but it must not be set up for gambling purposes.
You can sell tickets to members of the society, and people who aren’t members of your society. However, anyone who is not a member must buy the tickets on the society’s premises.
A private society lottery can only be used to raise money for good causes, it cannot be for profit or just for fun. It can be used to raise money for something relevant to your club, group or organisation or to raise money for another good cause.
Example: a local, non-league football club want to run a summer raffle. It could either raise money for a good cause or use the proceeds to raise money to buy new equipment for the club.
- tickets must only be sold to either members of the club/society or be guests on premises wholly or mainly used for the conduct of the club/society’s affairs;
- the lottery must only be promoted/arranged by members of the club/society who have written authorisation of the society or it’s governing body;
- the lottery may be promoted for any of the purposes for which the club/society is conducted or for other charitable purposes;
- the lottery must only be advertised on the society’s premises;
- each ticket must be sold by or on behalf of the promoters and the price must be paid to the promoters before a ticket is issued;
- price of tickets must be the same;
- tickets are non-transferable;
- there cannot be any rollover of the prizes to a draw at a later date.
Refer to Gambling Commission Guidance
Lotteries that must be registered with the Council (the licensing authority)
- Small Society Lottery
Small society lottery – eligibility criteria
The ‘small society’ must be ‘non-commercial’ and not run for personal or private gain.
A society is non-commercial if it is established and conducted (for one of the purposes listed in s19 Gambling Act 2005
- For charitable purposes,
- For the purpose of enabling participation in, or of supporting, sport, athletics or a cultural activity, or
- For any other non-commercial purpose other than that of private gain.
Matters that we consider when checking that your ‘small society’ conforms with the legal definition are set out in Gambling Commission guidance.
You can sell tickets to people aged 16 and over.
Ticket requirements; your tickets must show:
- the name of your society;
- the ticket price, which must be the same for all tickets;
- the name and address of the organiser, or, if you are using them, the name of the External Lottery Manager;
- the date of the draw, or information which enables the date to be determined.
You can claim costs for prizes and expenses up to the value of 80% of ticket sales.
There are rules around small society lotteries that you must follow:
- at least 20% of the lottery proceeds must be applied to the purposes of the society (the ‘good cause’);
- no single prize may be worth more than £25,000, even if it is donated;
- you cannot sell more than £20,000 of tickets in a single lottery, or £250,000 in any one year;
- you can roll over prizes to another lottery run by your society, but that prize cannot be worth more than £25,000;
- every ticket in the lottery must cost the same and the society must take payment for the ticket fee before entry into the draw is allowed;
- you can sell tickets door to door, online, by telephone or face to face, but you cannot sell tickets in a street (including passages through shopping malls);
- you must send details of your lottery to the local authority it is registered with, no later than three months after the lottery is drawn. The local authority will have a specific form to use for this return.
If someone else is running your lottery – your society can employ an external lottery manager (ELM) to run all or part of your lottery. However, if you employ an ELM they must hold an operating licence issued by the Gambling Commission.
How to apply for a small society lottery
Applications must be made to the Council for the area in which your society headquarters are located, even if you intend to conduct your lottery within another area.
Applications must:
- Be on the prescribed form (see below);
- State the purpose for which the society is conducted;
- Include the prescribed fee (the current fee is £40 for the first registration and £20 for renewals);
The easiest way to register or renew your lottery and pay the fee is to use our Online Lottery Application Form . Our new online system will email you confirmation of registration and a copy of your receipt straight away.
Online Lottery Application Form
If you do not want to register online then you will need to download our Lottery Application Form (pdf) and return it us, with your payment, at the address below.
You can make your payment for the paper form online by visiting our Online Payments page, selecting Lotteries and Gambling Licence from the drop down. The reference number will prefill for you but you will need to enter the amount. Please write your receipt number on your application form.
After the lottery – you must submit a lottery return
After your lottery is held the law requires that you must file your records of the lottery with the Council within three months of the lottery.
The information required is as follows:
- Arrangements for the lottery;
- Proceeds Amounts deducted as prizes;
- Amounts deducted as costs;
- Amounts applied to the society’s purposes;
- Any expenses paid to third parties;
- You can file all of this information by completing the returns form and returning it to us at the address and email below.
Download our Lottery Return Form (pdf)
All small society lottery returns must be signed off by two appointed members of the society, who are aged 18 or older, and a copy of their letter(s) of appointment must be submitted with the lottery return(s). It is therefore reasonable to advise that the society must have at least two members within their society, who must be aged 18 or older, and have been appointed for this purpose (in writing) by the society or, if it has one, its governing body. A copy of their letter or letters of appointment must be evidenced and provided.
Refusal of the registration application
The licensing authority may refuse your application for registration if it considers that:
- The society is not a non-commercial society;
- A person who is or may be connected to the promotion of the lottery has been convicted of a relevant offence (schedule 7 Gambling Act 2005)
- Information provided in or with the application for registration is false or misleading.
The licensing authority must refuse your application if in the preceding five years:
- A Gambling Commission operating licence held by the applicant has been revoked (s119 Gambling Act 2005);
- An application for an operating licence made by the applicant has been refused by the Gambling Commission;
- Once granted a Licensing Authority may revoke registration if it considers that the society no longer meets the application criteria. It may also cancel the registration should the society fail to pay the required fees.
A licensing authority may only refuse an application for registration after the society has had the opportunity to make representations. These can be taken at a formal hearing or via correspondence. Licensing authorities should inform the society of the reasons why it is minded to refuse the registration and provide it with at least an outline of the evidence on which it has reached that preliminary conclusion, in order to enable representations to be made.
You have the right to appeal against any decision of the Licensing Authority to reject or refuse your application.
All appeals must be made to the Magistrates’ Court within 21 days of notice of the Licensing Authority’s decision.
Revocation of a small society’s registered status
A licensing authority may determine to revoke the registration of a society if it thinks that they would have had to, or would be entitled to, refuse an application for registration if it were being made at that time. Revocations cannot take place unless the society has been given an opportunity to make representations at a hearing or via correspondence. In preparation for this, licensing authorities should inform the society of the reasons why it is minded to revoke the registration and provide them with the evidence on which it has reached that preliminary conclusion. Representations that may result after such a decision should be handled in accordance with local procedures.
Following the conclusion of any hearings and receipt of representations, paragraph 51 of Schedule 11 of the Act then requires the authority to notify the applicant or the society as soon as possible if their registration is still to be revoked, or if their application for registration has still been rejected.
The applicant or society may decide to make an appeal against the decision and has 21 days following receipt of the notice of the decision to lodge an appeal, which must be made directly to the local Magistrates’ court if in England. On appeal they may choose to affirm the decision of the licensing authority, reverse the decision, or make any other order.
Contact details
Licensing Team
01424 787550 licensing@rother.gov.uk
Rother District Council, Town Hall, Bexhill on Sea, East Sussex TN39 3JX