printer friendly page

Lotteries

The term "lottery" means " a distribution of prizes by chance where the person taking part has paid a stake (bought a ticket) to enter the draw". So it includes raffles and tombolas, scratchcards, football team cards, 100 clubs – as well as local lotteries of a type similar to the National Lottery.

The most common lotteries at fundraising events of course are raffles and tombolas – and there's separate information about each of these. Click here to find out about raffles. Click here to find out about tombolas.

This lottery information is about other sorts of lottery you might want to consider.

Lotteries and the law

You must keep within the laws about lotteries – which is now the Gambling Act 2005.

These Laws apply in Great Britain. In Northern Ireland, the law is the similar – except where shown.

·          as an incidental non-commercial lottery which is part of a fundraising event

·          as a private lottery for your members

·          as a small society lottery – which allows you to sell tickets to the public, and for which you need to register with your local council.

Each of these is explained in more detail on the rest of this page, and with some ideas for different kinds of lottery apart from raffles and tombolas.

Incidental non-commercial lottery

You are allowed to hold a lottery as "an incidental feature" of some other event - like fetes, bring and buy sales, or weekly group activities. In other words, the lottery must not be the only reason why people attend that event.

All of the proceeds – apart from money spent on prizes and other necessary expenditures in organising the lottery - must go towards supporting your group's activities or some other good cause. You must also keep to the following rules:-

·          you can only sell tickets at the event itself – but you can sell as many tickets as you like, and at whatever price you want

·          the draw must also take place during the event

·          you cannot have cash prizes - and the amount of money that can be spent on buying prizes (excluding donated prizes) currently cannot exceed £500 in total, and expenses (such as printing tickets) must not exceed £100 in total 

·          in Northern Ireland,  you must inform the police of your event and you must keep accounts

Children and young people can also buy or sell tickets.

Under the small lottery, you aren't limited to raffles or tombolas. You can:

·          sell football tickets – where the person buying the ticket selects a football club, and wins if their ticket is drawn out

·          sell scratchcards – where a winning combination earns a prize

·          hold any other kind of winning number draw.

So there's a lot of scope for something different from a raffle – or for holding a lottery (like football tickets) as well as a raffle. That can be attractive – a good fundraiser - if you've got good prizes.

But if you think cash winnings would be more attractive, then it's certainly worth thinking about a private lottery – or even a society lottery – instead.

Private lottery - 100 club, or similar 

A private lottery can be a tremendously effective fundraiser – especially with the attraction of cash prizes.

A simple – and often hugely successful – private lottery is the 100 Club: 100 people are each assigned a number between 1 and 100, and buy tickets to participate in a weekly prize draw. Say the tickets cost £1, and the weekly prize is £20 – the chances of winning are infinitely greater than those of winning £10 on the National Lottery, so it's attractive to those playing; and your group raises £80 every week, which amounts to £4160 over a year.

You can of course vary the 100 Club idea to suit your group's circumstances – more participants, fewer participants, monthly or even quarterly draws, more than one prize. You can also set whatever ticket price you want (except in Northern Ireland, where ticket sales may not exceed £1000).

For the draw itself, you can improvise - for example, with numbered ping-pong balls which you put into a raffle drum. You can buy numbered lottery discs to put in the raffle drum instead.

Alternatively, you can buy a random number selector which will pick winning numbers from whatever range of numbers you set - for example, from 1 to 100 if you have a 100 Club, or 1 to 200 if it's a 200 Club and so forth. Apart from your lottery, a random number selector is useful for drawing winning raffle ticket numbers as well.

It's sensible to make the draw when a lot of your members are present – so everyone can see it's done properly; and that might determine whether you'd have a weekly draw or less frequently. It's also a good idea to notify participants of the result – by a notice if you have a noticeboard, or even in the local paper; but be careful about the rules about promoting a private lottery (explained below).

The laws about private lotteries

All the proceeds of a 100 Club Lottery – or any other kind of private lottery - must go towards supporting your group's activities or other good cause (apart from prizes and other necessary expenditures in organising the lottery). You must also keep to the following rules:

·          the lottery can only be promoted by authorised members of the group or society – and you can't advertise the lottery outside the society's premises (and, if you hire rooms that other groups use, don't put up adverts)

·          tickets can only be sold to other members of the society or someone who is on the society premises

·          tickets must all be sold at the same price and refunds are not allowed

·          tickets have to include details of the promoters' names and addresses, the price, who may buy tickets, and that tickets are non-transferable 

Small Society Lotteries registered with the local council

If you want sell lottery tickets to members of the public – not just at fundraising events, or just to members - then you have to be registered as a small society lottery with your local council.

There are some charities – including hospices – who run winning number lottery draws on quite a large scale; at least one with a weekly prize of £1000. Some sell tickets in local shops. There are also subscription in advance schemes – where you buy your lottery tickets over the phone using a credit or debit card, for example. But a lottery on this scale is a major undertaking – and you need to be confident that you'll have enough people buying lottery tickets to make it a success.

Registering as a society lottery can be a good idea for smaller-scale lotteries. Say you are selling scratchcards: you'll almost certainly sell more to family, friends and neighbours who don't belong to your group, or come along to your events. And the same registration allows you to hold raffles where you sell tickets to members of the public before the draw.

When you're running a lottery in which you're selling tickets to members of the public, it's essential that you conduct the draw in such a way everyone will have confidence that everything is as it should be. With a weekly lottery, you might not want to make a special occasion of the draw - but it's still a good idea to hold it somewhere that members of the public can come along, and see it for themselves if they want. And it's certainly sensible to advertise the winning numbers, and winners (and details of the next draw) in a local newspaper or on your website, or both.

An electronic random number selector - which is absolutely random - is also a good idea.

The laws about Small Society Lotteries 

A member of your group will need to be registered as the promoter. You apply to register a “lottery schemeâ€� which covers all the raffles and lotteries you plan to hold over a year. Your first registration lasts until 31st December of the same year in which you applied, and costs a fee of £35 (at the current rates). Your registration can be renewed on 1^st January every year for a renewal fee of £17.50.

The rules for small society lotteries are very different from those for incidental non-commercial lotteries and private lotteries:

·          the maximum single prize is currently limited to £25,000 in value, including donated prizes

·          there is no longer any maximum ticket price - but all tickets must be sold at the same price, and refunds are not allowed

·          tickets have to include details of the society, the name and address of the promoter, the name of the local council with which the society lottery is registered, the price of the ticket, and when and where the draw will take place

·          tickets can not be sold to or by children under the age of 16 - nor sold on the street

·          the amount that can be spent on prizes (excluding donated prizes) must not exceed 55% of the proceeds, and expenses in organising the lottery must not exceed 35% of the proceeds - but a minimum of 20% of the proceeds must go towards the good causes which the lottery is supporting

·          what's called a return giving details of the proceeds of the small society lottery, and the amount spent on prizes and expenses, has to be submitted to the local council within 3 months.

If you're planning to register as a small society lottery, it makes sense to contact your local council - usually the Licensing section (or a similar title) - well in advance of when you want to hold your first draw to get their application form, and other information.

If you are planning total ticket sales for the year of over £250,000 (or over £20,000 in a single Lottery), then you have to be registered with the Gambling Commission instead.