TC09643 - [2025] UKFTT 01117 (TC)

HMRC contend that none of the provisions of section 159A are apposite to exclude the waived payment on Free Spins from being treated as gaming payments because the section is drafted to exclude only free gaming consequent upon a win from free gaming. Mr Donmall submits that this is the natural and plain interpretation of the language, particularly in the context of the heading to the section. Subsections 159A(1) – (3) relate to participation using an amount of money which has been won, and which cannot be withdrawn such that it can only be used for further participation in gaming (bonus cash). The two conditions effectively exclude the second and all subsequent play following participation by way of an offer which waived the gaming payment. Subsections (4) and (5) are not excluded winnings because they relate to further free participation by waiver of the gaming payment where that subsequent participation was won directly from participation through an offer where the gaming payment was waived.

Particular emphasis is put on the heading to section 159A which Mr Donmall contends imports the definition of freeplay as provided in section 160A(3) i.e. participation in remote gaming, in reliance on a freeplay offer which is itself defined as an offer which waives all or part of the gaming payment. HMRC submit that there is a clear intention that the concept of an offer to waive the gaming payment when participating in a particular game is freeplay. The first act of freeplay is entered into the RGD profits calculation with play won or funded from winnings from that freeplay being then excluded.

HMRC also point out that if we conclude, as we have, that the Customer’s participation in the MR Spin was not as a result of an offer waiving the gaming payment, the payment subsequently waived when the Free Play is used must fall within the scope of a gaming payment, otherwise RGD will be due on neither the MR Spin nor the Free Spin in the context of legislation clearly intended on its terms to bring within the charge to duty the first instance of free play and that would be an absurd result.