Every day people all over the world establish their own lottery. They have good experiences as lottery players themselves or think that their living place can use one. However, it’s not really easy to establish your own lottery. You have to deal with all kinds of rules. For example, you’re required to apply for a permit.
What are the rules in the Netherlands for lotteries?
The Dutch government monitors the developments on the gambling market closely and wants every gambling company to have a permit. Not everyone can establish a lottery, as can be read in the Gambling Law. It has some strict rules, including one that states that a lottery must be organized without commercial purposes. Besides that, a part of the revenue must be donated to charities. The total costs must be 50 percent of the total revenue, and with the other half the lottery must help charitable organizations. Also important is that participants cannot have any influence on the outcome of the lottery.
Permit is necessary
The government finds it important that every lottery company has a permit. They can apply for a permit at the local municipality, but sometimes a trip to the Gaming Authority is necessary as well. The exact place where a company can apply for a permit depends on the total worth of the prize pool. If the total worth is above 4500 euros, the Gambling Authority gets involved. Otherwise you can just go to the municipality and start the process.
Term of the permit Holland
The worth of the prize pool is quite easy to calculate. Just add all the retail prizes and write down the result. This also applies for sponsored prizes by the way. Have you obtained a permit? Congratulations! You should be aware of the short term of a permit though. It usually only valid for six months. Another rule is that a company can only organize a maximum of thirteen draws in half a year. Did the municipality or the Gambling Authority not give you a permit? Raise an objection and try again. Good luck!
Are the some exceptions?
There are only a few exceptions when it comes to obtaining a permit. It’s not required for parties who want to organize a promotional game of chance, for example. When a company organizes a such a game it promotes itself, whereas participants have a chance to win money at the same time. You probably know that nursing homes regularly organize bingos. They don’t need a permit for this. There are some requirements though. For example, has to be reported to the municipality. Second, the company that organizes the bingo has to be at least three years old. Last, but not least, the total amount of prize money must not be higher than 1550 euros. An individual prize must be worth less than 400 euros.
Gambling taxes are important as well
Lotteries have to deal with more than just a permit alone. We haven’t spoken about taxes yet. According to the law, taxes have to be paid for prize money above 454 euros. Many lotteries bring this a fee for prize winners. Some companies also pay the taxes themselves. Whatever you do, make sure that your lottery participants are aware of the gambling tax. This prevents unpleasant surprises for you and them. It’s no fun when a winner is confronted with high taxes after winning a big prize. The tax authority in the Netherlands wants players to pay 226 euros when they’ve won a prize between 4500 and 45.000 euros.