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Machine Games Duty: requirement to register before 1 January 2013

Those involved with machine games are reminded that those responsible for premises where machine games are played on which Machine Games Duty will be due must apply for registration before 1 January 2013 to avoid a penalty.

What is Machine Games Duty (MGD)

MGD is a new tax which is being introduced on 1 February 2013. It will replace VAT currently charged on the income from gaming machines and Amusement Machine Licence Duty (AMLD)

MGD will need to be paid on the profits from most machine games. A machine game is a game played on a machine for a maximum cash prize greater than the cost to play. This means that a gaming machine or a skills with prizes machine (SWP) may be a machine subject to MGD.

Someone responsible for premises where machine games are played on which MGD will be due must register for the duty with HMRC. In many cases the person responsible for premises will be the person who holds the licence or permit which allows machines to be provided for play on the premises. In certain circumstances more than one person may be responsible for particular premises - in these circumstances only one person needs to register.

What is happening and when?

The MGD online registration service was launched on 1 November 2012. If machine games will be available for play on 1 February 2013, those responsible for premises must apply for registration before 1 January 2013 to avoid a penalty.

The MGD online registration service will enable applicants or their agents to register for MGD online and make changes to their registered business details online.

Over the coming months, the service will also let registered people and agents submit and view returns online.

Machine Games Duty for Agents

HMRC's Machine Games Duty for Agents service allows agents to carry out a number of tasks online on behalf of their clients.

Key features of the service include:

  • setting up online authorisation to act on behalf of clients; and
  • changing client's registration details

In time, the service will also allow agents to:

  • submit client's MGD Returns online; and
  • view client's MGD Returns that have been submitted online

Points of interest

  • Those responsible for premises on which dutiable machines will be available for play at 1 February 2013 will be able to register for MGD from 1 November 2012.
  • Registrations in respect of existing operations must be made before 1 January 2013 to allow HMRC to process applications in plenty of time before 1 February 2013.
  • Businesses which have registered online for MGD will be automatically enrolled for the MGD online service. An ‘activation’ code (sometimes referred to as a PIN) will be sent in the post to the business address. This is required to activate the MGD online service

Find out more about Machine Games Duty Online

Find out more about How to sign up for Machine Games Duty for Agents

VAT recovery

Members may wish to consider whether there is any impact of moving from such income from machines being a taxable supply to becoming exempt, such as whether the VAT partial exemption rules apply or whether a business is entitled to be registered for VAT and the ramifications of that.

HMRC have published guidance on their views relating to the VAT implications of the changes at

Technical Team

26 November 2012


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