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Gambling Shop - VAT Invome and expenses

Gambling Shop - VAT Invome and expenses

Hi All,

I've recently taken on a gambling shop as a client. I've received the records from the previous accountant and information to complete the VAT return from.

I need clarification on one point and wondered if anyone knew the answer. Winnings taken via the "tills" are subject to gaming duty, those taken form the machines are subject to VAT (I know this is changing shortly).

Under the current system, can VAT be claimed on expenses used for tills betting such as Sky subscriptions? This wouldn't be in relation to the machine takings which is provides the VAT income.

When the new machine gaming duty comes into force will betting shops be exempt from VAT?

Thanks and I appreciate any answers


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04th Dec 2012 14:51

Gambling exemption

Gambling income is generally VAT exempt. You should have a look at HMRC Notice  701/29 (

The new Gaming Machine Duty is a mirror image of the VAT exemption. The idea is that where MGD applies VAT does not, and vice versa.

If the client is wholly exempt, then he cannot be registered for VAT. If he has some taxable income, then the Partial Exemption rules apply; in principle, he can only reclaim VAT which relates to his taxable activity; but he cannot reclaim VAT that relates to his exempt activity.

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