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How to calculate your gross gambling yield (GGY)

The annual gross gambling yield is calculated in accordance with the following formula:

A + B - C

A) is the total of any amounts that will be paid to the licensee by way of stakes in the relevant period in connection with the activities authorised by the licence

B) is the total of any amounts (exclusive of value added tax) that will otherwise accrue to the licensee in the relevant period directly in connection with the activities authorised by the licence

C) is the total of any amounts that will be deducted by the licensee in respect of the provision of prizes or winnings in the relevant period in connection with the activities authorised by the licence.

How free bets and bonuses affect annual gross gambling yield 

Free bets or bonuses should only be counted when calculating GGY if the customer has the unrestricted right to opt instead to receive a cash equivalent to the value of that free bet or bonus.  

As a stake (A)

If the customer uses as a stake a free bet or bonus, which provides them with the unrestricted right to opt to receive cash equivalent to the value of the free bet or bonus, then this would fall under A in the formula.  

As a prize (C)

If a prize is won in the form of a free bet or bonus which provides the customer with the unrestricted right to opt to receive a cash equivalent to the value of the free bet or bonus, then this would fall under C in the formula.  

All other free bets and bonuses do not need to be recorded.  

Examples of transactions 

  1. A customer wagers a £10 free bet/bonus which does not provide the unrestricted right to opt to receive cash equivalent to its value and loses the entire amount. There was £0 paid to the operator (A) and no prize awarded so £0 is paid out in prizes (C) the GGY from this transaction is £0. 
  2. A customer wagers a £10 free bet/bonus which does not provide the unrestricted right to opt to receive cash equivalent to its value and receives a prize of £20 in free bet/bonus which again does not provide the unrestricted right to opt to receive cash equivalent to its value. There was £0 paid to the operator (A) and £0 is paid out in prizes (C), the GGY from this transaction is £0. 
  3. A customer continues to wager the free bet/bonus from example ii. The customer wagers £20 in free bet/bonus, and wins a prize of £50, or a free bet/bonus which provides the unrestricted right to opt to receive £50 cash. There was £0 paid to the operator (A) and £50 paid out in prizes (C). The GGY from this transaction is -£50.   

Reporting on regulatory returns 

You need to report financial information in your regulatory returns. In order to report GGY correctly the wagered and payout amounts must reflect only the gambling transactions that form part of the GGY calculation as described above. So as in the examples above: 

  1. the transactions should be recorded as £0 wagered and £0 payout
  2. the transactions should be recorded as £0 wagered and £0 payout
  3. the transactions should be recorded as £0 wagered and £50 payout 

Loyalty schemes

Loyalty schemes such as ‘rake back’ or ‘VIP cash back’ or similar should not be counted towards A, B or C.   

These payments do not form part of a gambling transaction and are considered to be part of the costs of conducting business such as payments to affiliates for the acquisition of players. 

For example, an individual might stake £100 over the course of a month and win £20. They have a cash back agreement and get 10% of their losses back. The GGY calculation for that player is (A = £100) – (C = £20) = GGY of £80. 

The £8 the operator returns as cash back is not deducted from GGY and (on the basis it is now cash) if it is wagered the following month it would count towards amount staked.