Game show winnings

[simpo two]

I haven't won anything but I wondered what the tax situation is. If you win 'Who wants to be a millionaire?' is the £1M tax free, or does the winner get a demand for £400,000, or does the TV company pay it net of tax? (ie PAYW or 'Pay as You Win')

[Baconbonce]

I always thought game winnings were the same as lottery wins etc - ie. tax free.

Would be interested to know for sure.

[Eric Mc]

Winnings are tax free - providing they are from a legal source.

Winning at cockfighting or bull baiting would be taxable as criminal proceeds are subject to normal taxes.

[simpo two]

Eric Mc said:

Winning at cockfighting or bull baiting would be taxable as criminal proceeds are subject to normal taxes.

So they wouldn't prosecute you for participating in illegal pastimes, they'd just take a slice?

Mind you I doubt whether the kind of people who do cock-fighting etc declare anything anyway!

[Eric Mc]

No, they would prosecute you AND they might collect the tax and now, under the Proceeds of Crime Act, they'd seize your assets too (very painful).

[srebbe64]

I think I'm correct in saying that this is why Premium Bonds are a good flutter. Doughtless Eric Mc will correct if I'm wrong!

[Eric Mc]

You are correct - there are no tax charges on Premium Bond winnings.

[simpo two]

Except that IIRC the yield was reduced from 4% to 3%. Still, you *might* win a million and you can get your stake back too

I suppose PBs are the lottery without the razzle...

[srebbe64]

simpo two said:

Except that IIRC the yield was reduced from 4% to 3%. Still, you *might* win a million and you can get your stake back too I suppose PBs are the lottery without the razzle...

Better than that, you can withdraw all your money at a future date. As far as I'm aware, you can't do that if you fail to win the lottery.