Do I need a lottery syndicate agreement?

I am in a syndicate with family members. We are not worried about payments in, publicity, how many draws etc this is all agreed. But I am wondering if there are any implications to us should we win if we don't have a signed agreement e.g tax implications?Do I need a lottery syndicate agreement?
You are worrying about the wrong things.



There is no tax on cash gifts at any time. In the worst case scenario one person would be deemed to win, and they would be deemed to be giving money away to other syndicate members. If this person died within 7 years there might be inheritance tax problems, but (contrary to another answer) there is never capital gains tax or anything else to pay on the gift itself.



But this is all irrelevant anyway. If you win you can ask the lottery company to pay the money jointly to you all, so you each receive your tax free share without any complications.



What you need to worry about is the basics on which you have supposedly agreed. The point of getting this in writing is that it means there can be no confusion or argument in the future. And no matter how close your family is now, don't underestimate the friction that can be caused when someone puts 拢5 million on the table in front of you.



You need an agreement that specifies how many lines you buy, who is a member, how you can leave or join, what happens if someone does not pay they share of entry fees on time, how you distribute small winnings, etc.Do I need a lottery syndicate agreement?
There are two very good reasons why you should have an agreement. Firstly, a big win could have a strange affect on the ticket holder who might want to freeze the rest of the syndicate out of the action. Secondly, if you cannot prove you have syndicated, the dividend will be treated as a gift which will attract an unfortunate rate of Capital Gains Tax.

jayco

cleveland