A society lottery is a valuable fundraising tool for non-commercial societies set up for charitable purposes, for enabling participation in, or of supporting, sport, athletics or cultural activity or any other non-commercial purpose other than that of private gain.
A Lottery Must Meet Three Criteria
To be considered a lottery, there are three key criteria that must be met:
- Pay to enter
- Prizes are allocated
- The prize allocation process must be “wholly by chance’
Pay to enter
Most lotteries you’ll find will have a £1 to £2 entry fee. There are higher prices, but these are relatively uncommon, especially for small society lotteries. Once the price is set, every ticket costs that price and there can’t be discounting or special offers – every ticket must be the same price and must be paid in full – so no BOGOF (buy one get one free) offers.
Prizes are generally cash or goods with a monetary value, such as a car or £1000 prize. The Weather Lottery and Sports Club lottery both have a £25,000 jackpot, which is the largest a small society lottery can offer under current legislation.
The most common types of prizes come from a either fixed prize pool which guarantee a prizes (e.g. £1000 first prize followed by a series of smaller prizes), a guaranteed percentage of ticket sales (e.g. a club 50:50), or a fixed amount which may or may not be won.
Perhaps the most important point to remember here is that a lottery must be profit making – the prizes can’t outweigh the sales; by law a minimum of 20% of the sales (proceeds) must be profit.
Think of names in a hat, balls randomly coming out of a machine, random number generators or anything which can be mathematically proven to be completely random – all are valid ways to draw the winners.
If there is any element of skill or where knowledge can give an edge, then that’s simply not a lottery.
Is A Society Lottery The Same As The National Lottery?
Although The National Lottery is the most famous lottery, the reality is that is has it’s own legislation – for example, did you know that it’s the only lottery that can create a millionaire? The simplest way to think about it is that the National Lottery is a one of a kind.