Tax On Lottery Winnings In Spain?

Tax On Lottery Winnings In Spain
20% The percentage of withholding or payment on account will be 20%.

Are winnings from lottery taxable?

Good question. If you’re wondering if you have to pay tax on lottery winnings then guess what, you’ve come to the right place! While lottery winnings aren’t taxable, you may be subject to taxes once you’ve deposited the funds or if you give any winnings as a gift.

Why is lottery so popular in Spain?

If you read last week’s blog post , you’ll know that it wouldn’t be Christmas in Spain without spending at least 20 Euros in an attempt to win the lottery, but this national pastime is such a treasured, elaborate institution that explaining it properly deserves a whole post of its own.

I’m going to explain how Spain’s obsession with Christmas gambling started, how the surprisingly complex system works, as well as why you absolutely must buy a ticket if you don’t want to risk crying into your Christmas dinner whilst your entire village celebrates winning the jackpot.

The Spanish Chritstmas lottery ( El Sorteo Extraordinario de Navidad ) is the world’s biggest lottery in terms of cash prize payouts and has been organised every year since 1812, even during the Spanish Civil War and during Franco’s regime, making it the second longest continuously running lottery in the world.

It was initially set up to raise money for Spanish troops fighting against Napoleon’s armies and was an instant hit. It turns out, people are significantly more enthusiastic about buying lottery tickets than paying their taxes.

Since then, it’s only grown in popularity. It’s not at all uncommon to see massive queues spilling out of betting shops whenever there’s a special lottery draw with a sizeable jackpot. And with the Spanish betting a higher proportion of their income than almost any other nation – around €1.

  1. 9 billion a year, equal to around €480 per head or about 15 percent of the average net household income – we could say that the lottery is a national infatuation;
  2. To meet demand there’s a wide range of lotteries run by the Spanish and Catalan governments, such as La Primitiva , and La Grossa , as well as by the National Organisation for the Blind, La ONCE , whose ticket stalls are staffed by blind and disabled people;

By law, lottery prize money distributed to the winner(s) needs to reach 70% of the total sum of tickets sold each draw, with the remaining 30% going to the state and various charities, so it still fulfills its original purpose of raising considerable funds for the government.

  1. If you want to take part in this Spanish tradition, make sure to buy a ticket from one of the many little kiosks on the street or in one of the estancos (tobacconist shops);
  2. Even if you’re visiting Spain in summer you can still get your hands on a ticket – the Christmas lottery usually goes on sale from mid-July!  The Sorteo Extraoridinario is based on tickets ( billetes ) pre-printed with a five digit number ranging from 00000 to 99999;

This system only produces 100,000 unique ticket numbers, so to produce more tickets, each ticket number is printed multiple times in several series. The number of series changes every year, but in 2019 there are 170 series so there will be “Series 001 Ticket 00000” through to “Series 170 Ticket 99999”, meaning that there’ll be 170,000 tickets for sale.

  1. Usually lottery outlets only sell one or two numbers, so the winners often live in the same village or work in the same company;
  2. This is perhaps one of the main reasons why so many Spaniards play the Christmas lottery;
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Imagine all of your village or workmates winning, whilst you kick yourself for not playing! That, plus the lottery’s significantly increased odds. The probability of winning a cash prize in Spain’s Christmas lottery is considerably higher than most other lotteries as more than 10% of tickets win some sort of prize.

  1. Chances of winning the top prize, El Gordo (“the fat one”) , are 1 in 100,000, (0;
  2. 001%);
  3. Compare that to the 1 in 139,838,160 (0;
  4. 00000072%) chance of winning the EuroMillions jackpot;
  5. I know which one I’d rather play! But there’s a twist;

With each ticket costing €200, most people just buy a tenth of one for €20 ( un décimo ), entitling them to 10% of any prize that ticket has won. Aside from décimos , you can also buy participaciones for a couple of Euros from many bars, restaurants and shops, which are even smaller than décimos.

In practise, most people actually buy several décimos and participaciones – the average Spaniard spends around €68 on these lottery tickets. Told you they’re obsessed! However, these investments in the lottery perhaps make sense when you consider the increased chances of winning and the fact that there are thousands of cash prizes to be won.

Unsurprisingly, people have many traditions related to the Christmas lottery ranging from the diligent to the superstitious, whether that’s choosing a number with meaning to them like a family member’s birthday or their wedding anniversary, rubbing their ticket on a pregnant belly, standing for hours in long, snaking queues to buy tickets from places which had previously sold winning tickets, collecting décimos from different cities, and even travelling for miles to purchase tickets in the Pyrenean village of Sort, meaning “luck” in Catalan.

Tune into the live draw which takes place every year at 9am on the 22nd December. Since 2012 it has been held in the Teatro Real in Madrid which fills to the brim with hopeful gamblers, often wearing extravagant lottery-related fancy dress.

In an elaborate show broadcast live on television, numbers are drawn to determine the winning numbers and their corresponding prizes in a ceremony which lasts hours. Why hours? Most lottery draws are over and done with in minutes! Well… Unlike most other lotteries, two revolving drums are used: the largest containing 100,000 wooden balls, each displaying a unique 5-digit ticket number, and the smaller containing 1,807 balls each representing a cash prize.

  1. There’s one ball for El Gordo, one for second prize, one for third, two for fourth, eight for fifth and the remaining 1,794 for the smaller prizes called la Pedrea (the pebble-avalanche);
  2. In addition to the cash prizes, some prizes are calculated from the winning numbers (see table above for those so inclined), the smallest prize being the reintegro for the 9,999 numbers with the same last digit as the first prize – meaning 10% of all tickets get their money back;

Bearing in mind that there’ll be 170 series of the 1st prize number, 4 million Euros could be paid out 170 times to a full sheet of ten tickets with the 1st prize number – meaning the total payout to the first prize amounts to a whopping 680 million Euros.

This is the largest lottery in the world after all! As you can imagine, it takes a long time to draw all the numbers, especially when you take into account that each ball is sung out by children. Yes, as is nearly always the case in Spain, children are involved in everything, even gambling.

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The children of San Ildefonso school in Madrid work in shifts to draw and sing the numbers from each sphere in a ritual that lasts approximately three hours and often ends with tears from all the nerves and exhaustion of relentlessly singing out all those numbers on live national television. load)

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  • RTVE 2. 01M subscribers PREMIOS de la LOTERÍA DE NAVIDAD 2018 Watch later Share Copy link Info Shopping Tap to unmute If playback doesn’t begin shortly, try restarting your device. You’re signed out Videos you watch may be added to the TV’s watch history and influence TV recommendations.

    What happens if u win the EuroMillions?

    How long after winning the lottery do you get the money? – During the home visit by the Winners Advisory team, a number of checks will be carried out to verify the winner. ‘Within half an hour I can tell if someone has won the money,’ Andy revealed. As well as checking the winning ticket is legit, Andy and his team are there to answer any questions that the winners may have and, as you can imagine for someone who has just become a (sometimes multi) millionaire, they have more than a few: ‘Sometimes we get to people’s houses and we don’t even open the computer for an hour because we just sit there and answer people’s questions,’ Andy said. ‘ A recent EuroMillions player in the UK scooped a £184 million jackpot (Picture: PA) As soon as the winning ticket is verified and the ID of the winner confirmed, the Lottery can pay the winner their money on that very day. However, once the money is paid into an elected bank account, it takes two days for the money to process before it can be withdrawn. This means that the longest you have to wait before getting the money is around three days between discovering you’ve won the lottery and actually being able to spend the cash.

    What happens when you win the Euro lotto?

    How Long To Claim? – You have 180 days from the date of the draw to claim EuroMillions prizes in the UK. Most winners will claim within the first few days or weeks of finding out that they’ve won, but there is certainly no obligation to do so. Your claim will be valid at any time within the 180-day window.

    The most important thing to do is keep your ticket safe until the claim process is underway. If you lose your ticket you may still be able to claim a prize but you must make contact with the National Lottery within 30 days.

    Lottery officials will then conduct rigorous security checks to validate your claim.

    See also:  Are Spain Going On Amber Plus?

    Which is the best lottery to play in Spain?

    Which Spanish Lottery has the Best Odds? – Sometimes, it’s hard choosing which lottery to play next, especially when they all have amazing prizes and benefits. One easy thing you can do is check the odds of winning the lottery jackpot. The lower the odds, the higher your chances of claiming a prize! The Spanish lottery with the best odds of winning is undoubtedly Spain Bonoloto.

    1. Because of its smaller jackpot prize and the fact that it stages six lottery draws a week, the odds of winning the top prize is an unbeatable 1;13,983,816! Compared to other Spanish lotteries, Bonoloto is the game to play if you want to win fast;

    If you want to win the biggest jackpots in Spain, you have some stiff competition! The Spanish lotteries with the lowest odds of winning are the national favourites; La Primitiva and EuroMillions Spain. When you play either of these, your odds of winning is 1:139. While these incredibly low odds may seem daunting, winning a prize from either is well worth it! Check out the jackpot winning odds of each Spanish lottery in the table below:

    Lottery Match Jackpot Odds
    La Primitiva 6/60 1:139,838,160
    El Gordo 5/54 + 1/10 1:31,625,100
    BonoLoto 5/80 1:13,983,816

    .

    How do I avoid taxes if I win the lottery?

    How can I avoid paying taxes on lottery winnings? – You cannot legally avoid paying taxes on your lottery winnings. The IRS will usually require that the lottery company withhold taxes from your winnings before you even receive a check. But you can reduce your tax liability by taking your lottery winnings in installments, donating a portion of it to charity, and deducting any gambling losses.

    What should I do first if I win the lottery?

    What should I do if I win the EuroMillions?

    How Long To Claim? – You have 180 days from the date of the draw to claim EuroMillions prizes in the UK. Most winners will claim within the first few days or weeks of finding out that they’ve won, but there is certainly no obligation to do so. Your claim will be valid at any time within the 180-day window.

    1. The most important thing to do is keep your ticket safe until the claim process is underway;
    2. If you lose your ticket you may still be able to claim a prize but you must make contact with the National Lottery within 30 days;

    Lottery officials will then conduct rigorous security checks to validate your claim.

    How much do you get taxed on EuroMillions UK?

    Are Lottery Winnings Taxed in the UK? – All lottery prizes in the UK are awarded tax-free, regardless of how much you win or which game you play. Lottery winnings are not treated as income by HM Revenue & Customs, which is the government department responsible for taxation.