Lotto Tax

marcus2000 · 19-02-2016 01:32PM #1

disclaimer - I haven't won the lotto ....yet.

This is more a theoretical enquirey as I have had the discussion a few times - those times you insist you are right, but actually haven't a clue.

If i did a €2 quick pick, and my friend paid me 20c towards it, and we had an agreement that they had a 10% stake in any winnings....If you won a million quid, I assume, the national lottery would award you 1.8m and them 200k, a long with the necessary taxation documentation to say it's exempt (or however that works)??

Its a curiosity question. I understand it could be interpreted as a means to avoid tax when giving away winnings to family and friends, but I was wondering if its actually a possibility. its as if one person does two lines in a syndicate, id assume they be entitled to twice as much as everyone else. (so long as there was an agreement in place)

Sunny Dayz · 19-02-2016 02:02PM

I think both yourself and your friend would have to sign the back of the ticket to both have a claim on the winnings. I'm assuming then that the winnings would automatically be split 50/50 between you both unless an agreement had been drawn up and signed in advance.

marcus2000 · 19-02-2016 02:46PM

That was kinda the question. If there is an agreement, would the proportional split be enforceable. I assume having 1 friend with a 20c stake would be the same as having 5 friends with a 20c stake. In in a 2€ winning lotto ticket, with a price of €2m, one person gets say €1m tax free, and the 5 friends get 200k tax free........ subject to the agreement, and everyone having signed the ticket.

Marcusm · 19-02-2016 07:26PM

You need to make your deal as to ownership before the draw and be comfortable that both will live up to it. Clearly you could go to a solicitor to draft documents memorialising the transactions and dealing with custody of the ticket and the respective ownership interests etc but that would be senseless. Prior to the draw, it is simply a piece of paper with hope value, most likely worthless. From the point of the draw, any winning ticket becomes valuable property, should you decide to transfer part of the ticket at that point in time without any prior agreement, you would be making a gift subject to capital acquisitions tax (in theory, likely not provable in practice).

googled eyes · 19-02-2016 07:34PM

So you both own a share of the winning ticket. You 90%, him 10%. The lotto will pay you the winnings and then you would pay the 10% to your friend.

When you are in claiming your win you inform the lotto people that it is a syndicate and you both fill out a form with your details ( I think its just name and address). Then when you pay your friend their share it is not taxable. Although I'm not sure if he would have to inform Revenue of the win/amount of money he received.

Fwiw if I was to ever win a huge amount on the Lotto I plan on declaring the ticket as a syndicate win and splitting the money among my family as I see fit. Their would be no way to prove that its not part of a syndicare

marcus2000 · 19-02-2016 07:36PM

My question relates to taxation and lottery rules. Nothing more. Can you apportion the winnings based on agreed percentage ownership of the ticket? Each person getting the winnings in proportion to the amount they invested, tax free.

marcus2000 · 19-02-2016 07:37PM

googled eyes wrote: »

So you both own a share of the winning ticket. You 90%, him 10%. The lotto will pay you the winnings and then you would pay the 10% to your friend.

When you are in claiming your win you inform the lotto people that it is a syndicate and you both fill out a form with your details ( I think its just name and address). Then when you pay your friend their share it is not taxable. Although I'm not sure if he would have to inform Revenue of the win/amount of money he received.

Fwiw if I was to ever win a huge amount on the Lotto I plan on declaring the ticket as a syndicate win and splitting the money among my family as I see fit. Their would be no way to prove that its not part of a syndicare

Thanks. That's exactly what I was asking!!!

mickdw · 19-02-2016 07:37PM

What you describe is commonly done and advised by national lottery.
Families, syndicates etc always go the route of shared ownership to distribute the win tax free.
Nothing new in your thinking.

marcus2000 · 19-02-2016 07:39PM

mickdw wrote: »

What you describe is commonly done and advised by national lottery.
Families, syndicates etc always go the route of shared ownership to distribute the win tax free.
Nothing new in your thinking.

Thanks. I was curious just because it kinda makes sense. I didnt think it was advised by Lottery. I assumed it could be possibly be considered tax evasion, at some level.

scheister · 24-02-2016 02:35PM

Its a interesting point. The syndicates idea is well know but normally any i have seen its equal share. Not sure would mixed percentage syndicates be seen in the same light and where would they draw the line.

Lotto Tax

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