MGD deadline is on January 11

02/01/2013

HM Revenue and Customs (HMRC) has issued a reminder that venues operating gaming machines need to register for MGD by January 11, 2013.

The duty will apply to machines which offer a cash prize which is greater than the cost of playing. The standard rate will be 20%, although a reduced rate of 5% is available where the maximum cost per game on a machine is GBP0.10 and the cash prize is GBP8 or less. The duty will come into effect from February 1, 2013, but HMRC warns that applications received after January 11 may not be processed in time to avoid a penalty.

HMRC estimates that approximately 42,000 venues will be affected by the change, including bookmakers, casinos, amusement arcades, bingo halls, pubs, and clubs. HMRC advises operators to make use of its online registration service, although a paper application form is also available to download.

The removal of value-added tax (VAT) from the takings of gaming machines brings the UK into line with European Union rules on gambling activity, which provide that gambling should normally be exempt from VAT. The changes do not affect “virtual” on-line fruit machines, and VAT will continue to be payable on the takings from amusement machines.