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HMRC clarifies Policies on Quiz Games & Tax Arrears

On the 9th March 2010 the HMRC issued a brief clarifying their policy regarding AMLD in relation to Skills with Prizes machines and in particular their policy regarding the pursuance of back payments. 

This guidance has been issued as a clarification on Notice 454 (October 2007), which when read may lead many operators to consider that the SWP machines installed in their premises are exempt from AMLD.

The Commission reiterate their stance that AMLD is due on all gaming machines, irrespective of how they are described.  In the opinion of HMRC, “quiz games played on machines can be games of chance if they involve both an element of skill of chance and an element of skill, an element of chance that can be eliminated by superlative skill or are presented as involving an element of chance.  Machines on which these games are played are gaming machines under Section 25 of the Betting & Gaming Duties Act 1981 and depending on the stake and prize limits, they are licensable gaming machines or are presented as involving an element of chance.

This reiterates their stance throughout this recent review.  However, the brief does give some comfort regarding arrears, HMRC have stated “where businesses are provided quiz machines that are games of chance on the machines, we will not be collecting any arrears of AMLD which may be due in law before the date of this brief (9th March 2010).  We will only collect any arrears of AMLD which may be due in law from the date of this brief.  This paragraph will not apply to be provided of games of chance or on a machine which also provides quiz games”.  The position on “questionable” SWP remains unclear.

For a link to the brief, please click here http://www.hmrc.gov.uk/briefs/vat/brief0610.htm

This brief comes before the end of the HMRC SWP review, which is due to report towards the end of June 2010.

If you would like to discuss the content of this e-mail, please contact Christopher Grunert.