Tax on winnings

joeypesci

Don't know where to put this. I know we're not allow to discuss gambling, but this isn't really.

In a lottery syndicate (I know the odds are crap. My money, my choice). Question is, one person manages it and buys tickets. I was told by someone else the other day, if we won. The main person would get the cash, but we then wondered how it would be shared out, as I was told she can't just gift each person their share because they'd be taxed on that gift.

So if you won a big win and wanted to give friends some of it, our those friends taxed on that gift?

McKneff

Google lottery syndicate, there is probably a template agreement somewhere that gives each person the right to a share. All legal and above boar and no tax to pay by anyone.

There is no tax on winning money, put it in the bank, get interest on it and the only tax yu pay is on the interest it earns.

joeypesci

Thanks. I'll take a look.

rs65

there is a syndicate agreement template on the lottery site

https://www.national-lottery.co.uk/player/p/help/syndicates.ftl

dzug1

There is no income tax on gifts in the UK - because they are not income.

The problem is that if the ticket holder dies within 7 years, any winnings he still has plus those he has gifted count as part of his estate for inheritance tax calculations.

A valid syndicate agreement should overcome this problem

Nosht

I have a Syndicate Agreement in a sealed letter, in a fireproof safe, posted to myself with a postmark stamped on it to make sure that in the event of a BIG win the syndicate is paid out without any tax implications.


N.

Ballymackeonan

When I was studying tax (many years ago...) we were told that all gambling winnings were free of tax - because otherwise there would have to be tax relief allowed on all gambling losses!

TrickyDicky101

Ballymackeonan wrote: »

When I was studying tax (many years ago...) we were told that all gambling winnings were free of tax - because otherwise there would have to be tax relief allowed on all gambling losses!

And the sum of all gambling losses must be greater than the sum of all gambling wins! I remember being taught that too (many years ago)

psyman17

What would happen if you won a decent amount and gave a couple of million to your sister for example. Would she have to pay tax on it if not in a syndicate?

CLAPTON

psyman17 wrote: »

What would happen if you won a decent amount and gave a couple of million to your sister for example. Would she have to pay tax on it if not in a syndicate?

there is no gift tax as such in the UK so you can give as much as you like to anyone you like without either party paying tax.

however we do have a Inheritance Tax .... so if you die then your estate plus gifts made within the previous 7 years may be liable to IHT (some gifts excepted)

joeypesci

Checked out the lottery site after having been given the syndicate template link. It looks like it's a good idea to do the form or you could be liable for inheritance tax. I also think inheritance tax is the most bent tax known to man. Why should the government gain money from someone dying. There is no expense to them and for some people, it's the only way they'll be able to get a house/flat by inheriting it. But with inheritance tax, most have to sell to cover the cost.