Should we pay tax on prizes?

14 Responses

  1. susan devere says:

    I am running the winacastle competition and I think it would be worth paying the taxes on the US entries. We may be adding that in this week. Just looking into it. But if people enter, they shouldnt have to worry about the cost.

  2. William Ratcliffe says:

    Concerning the lottery surely the tax as already been taken out before the money is paid out , its certainly not tax free ??

    • Di says:

      TNL don’t pay tax, they do have to give 12% of ticket sales as ‘lottery duty’ to the government. And the 28% of sales that goes to ‘good causes’ is sometimes considered a ‘stealth tax’ as some of it goes to the Big Lottery Fund, which supports public spending.

  3. D Fairman says:

    I was always under the impression that US compers only had to pay tax on the combined value once it was over a certain amount. Kind of like in the UK, if we earned a wage amount, we’d have to declare it.

    • Monica Gilbert says:

      Taxes are triggered above a certain value, and the sponsor has to supply a specific form stating the value of the prize so that it is declared on tax returns. My mother got stuck paying taxes on a small riding tractor type thing she won to use in the garden. I don’t remember the value. I haven’t declared any of my contest winnings for a few reasons. I don’t think the values have been high enough to trigger taxes. UK competitions don’t give IRS (US tax agency) forms. And I would honestly find it ridiculous to pay taxes to a country I haven’t lived in for years for a contest entered and won on another continent.

  4. Lorraine says:

    If I had to pay tax on winnings, I’d definitely have to reconsider what I entered.

    And this post gave me a quick double take, because Christopher Fielden is a very old friend of mine, and blooming lovely bloke.

  5. Mark Mascall says:

    Same as some National Lottery scratchcards etc prizes can already be taxed if payments are spread over more than one year.
    But it is very unlikely that will happen with one off prizes as if the income becomes taxable then all the expenses related to it can become tax deductible – cue rush for self-employed registrations – that’s why income from gambling is not taxable, most gamblers lose and could offset their losses against other taxable income effectively getting hmrc to cover their losses while if they were lucky enough to win overall they would only lose a percentage of their winnings.

  6. Hayley Atkins says:

    No,it would take all the fun out of comping. Dont give this awful government another silly idea to put in place!

  7. Kathryn Hipkin says:

    No. It wouldn’t be any fun any more, just another expense

  8. janice skelton says:

    I doubt it, it would be a case of could you afford to carry on comping particularly if you couldn’t find funds before the prize was allocated.

  9. Christina Curtis says:

    I am not sure I would carry on with the Hobby in the same way having to worry about affording the tax. Especially when lots of the things I win are put away for Christmas I would see it as an extra expense rather than money saving. and I would hate to be taxed on a runners up prize when it wasn’t something I particularly wanted if that makes sense.

  10. Sylvia Robbins says:

    I’d devote my time to another hobby.
    I would just say that if uk residents enter draws set by Irish (Eire) companies and win a prize, I have been told that taxes or import duty must be paid.
    This would apply to all foreign countries. This may not be true.

  11. Neill Johnstone says:

    I detest having to deal with HMRC so there’s no question I’d comp differently. Never mind the paperwork involved with paying tax on 99p items, what do you do about paying tax on “goodie bags” and promotional movie tie-in trinkets? And if I’m paying tax, does that make me (and every other one-time winner) professional?

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