This box is not visible in the printed version.
Gambling Commission's guidance on the Economic Crime Levy and how licensed casino operators can prepare for it.
Published: 30 March 2023
Last updated: 30 March 2023
This version was printed or saved on: 31 May 2023
Online version: https://www.gamblingcommission.gov.uk/guidance/the-economic-crime-levy
The Economic Crime Levy (ECL) is an annual charge on entities who are supervised under the Money Laundering Regulations (MLR) (opens new tab) and whose United Kingdom (UK) revenue is greater than £10.2 million per year.
The levy is being collected by the following three statutory anti-money laundering supervisors’:
Each of these bodies already has responsibility for supervising businesses in certain sectors of the economy for the purposes of preventing money laundering, and will be responsible for collecting the levy from them.
The Commission will therefore be collecting the ECL from licensed casino operators.
All casino operators will be asked to submit their annual returns as part of this process.
You must pay the ECL to the Commission if you are a licensed casino operator and your UK revenue is greater than £10.2 million in the financial year (pro-rated).
The Economic Crime Levy (ECL) will be paid as an annual fixed fee determined by the size banding into which a Money Laundering Regulations (MLR) supervised entity falls. This is based on their United Kingdom (UK) revenue in their accounting period ending in the previous financial year.
ECL band size | UK revenue |
---|---|
Small | does not exceed £10.2 million |
Medium | greater than £10.2 million but does not exceed £36 million |
Large | greater than £36 million but does not exceed £1 billion |
Very large | exceeds £1 billion |
Casino operators must take all their UK revenue into account, and not just that derived from their gambling activity and services, when determining into which levy band they fall.
Band size | ECL fee |
---|---|
Small | No fee |
Medium | £10,000 |
Large | £36,000 |
Very large | £250,000 |
The levy will first be charged on entities that are MLR supervised at any time during the financial year from 1 April 2022 to 31 March 2023. The amount payable will be determined by reference to their size based on their UK revenue from accounting periods ending in that year.
Amounts will be payable by 30 September following the end of each financial year. Therefore, the first payments will be due by 30 September 2023.
Casino operators must take all their UK revenue into account, and not just that derived from their gambling activity and services, when determining into which levy band they fall.
UK revenue is defined in section 57 of the Finance Act 2022. This states that, for the purposes of determining a person’s UK revenue in a relevant accounting period, the following applies:
For the purposes of determining a person’s UK revenue in a relevant accounting period, the following applies:
(2) In the case of a UK resident person, the person’s UK revenue is all of that person’s revenue after deducting so much of their revenue as, on a just and reasonable apportionment, is attributable to the activities of any permanent establishment of the person in a territory outside the United Kingdom.
(3) In the case of a non-UK resident person, the person’s UK revenue is so much of the person’s revenue as, on a just and reasonable apportionment, is attributable to activities of any permanent establishment of the person in the United Kingdom (subject to (4) and (5)).
(4) Paragraph (5) applies to a non-UK resident person who, by virtue of regulation 9(4) of the Money Laundering Regulations (casinos which provide facilities for remote gambling), is regarded for the purpose of those regulations as carrying on business in the United Kingdom.
(5) The person’s UK revenue also includes so much of the person’s revenue as—
(6) References to a “permanent establishment” of a person are to be read—
(7) References to a person’s “revenue” in a relevant accounting period are (subject to (9)) references to—
(8) Where a person does not draw up accounts for a relevant accounting period in accordance with GAAP, the reference in (7)(b) to any amounts which in accordance with GAAP are recognised as revenue in the person’s profit and loss account or income statement for the accounting period is to be read as a reference to any amounts which would be so recognised if the person had drawn up such accounts for that accounting period.
(9) The following are to be ignored in determining a person’s revenue for the purposes of this Part—
For the purposes of the Economic Crime Levy (ECL), UK revenue is calculated for the relevant accounting period that ends in or on each financial year.
An operator’s accounting period runs from 1 January 2022 to 31 December 2022. This accounting period ends within the financial year of 1 April 2022 to 31 March 2023. The operator will therefore use the accounting period of 1 January 2022 to 31 December 2022 to calculate their UK revenue for the financial year of 1 April 2022 to 31 March 2023.
If there are no accounting periods ending in the financial year, the relevant accounting period is taken as the accounting period that ends during the period of three months beginning with the end of the financial year. This will only affect new businesses who start during a financial year where their first accounting period ends between April and June.
An operator’s first accounting period runs from 01 June 2022 to 30 May 2023. There are no accounting periods ending in the financial year 1 April 2022 to 31 March 2023, so the relevant accounting period is taken as the accounting period which ends during the three months after the end of the financial year. The operator must use their accounting period of 01 June 2022 to 30 May 2023 to calculate their UK revenue for the financial year of 1 April 2022 to 31 March 2023.
The amount you need to pay may be reduced if you carry out regulated activities for only part of the financial year. This reduction is calculated using a daily apportionment of the time you are supervised for Money Laundering Regulations (MLR).
If there are no accounting periods ending within the financial year, the relevant accounting period is taken as the accounting period that ends within 3 months of the end of the financial year. This will only affect new businesses who start during a financial year where their first accounting period ends between April and June.
If your accounting period is shorter than 12 months, the ECL band sizes are adjusted accordingly. This apportionment is calculated using days.
If your UK revenue was £34 million for a 9-month accounting period, you would fall within the large band (£36 million × (9 ÷ 12) = £27 million large band minimum). The ECL payable must then be calculated using days, for example 270 ÷ 365 × £36,000 = £26,630.
An operator was only licensed as a casino operator for 200 days of a 365-day financial year. The operator falls within the £10,000 medium entity band. The operator will pay a reduced ECL, calculated as (200 ÷ 365) × £10,000 = £5,479.
You must pay the Economic Crime Levy (ECL) to the Gambling Commission if you are a licensed casino operator and your United Kingdom (UK) revenue is greater than £10.2 million in the financial year (pro-rated).
If you are in the small band (UK revenue does not exceed £10.2 million), you will still need to complete a return even though no payment will be made.
You will need to submit a return and pay the levy every year that your UK revenue exceeds the £10.2 million threshold. You will need to declare your UK revenue and pay your liability based on the bandings.
A short return should be completed that will allow you to report:
You should submit returns on a yearly basis, even if you do not meet the threshold for paying the ECL in that year (a Nil Return).
The Commission will provide operators with details of the way to submit a return.
You must pay the levy by 30 September each year, beginning with 30 September 2023.
The Commission will continue to publish guidance on the ECL, which will include how to submit ECL returns to the Commission and pay the ECL to the Commission. Further guidance will be published in April, including how to submit a return.
HMRC and the Financial Conduct Authority will publish their own guidance on the ECL. If either HMRC or the FCA are your collection authority, you should follow their guidance.
You can email queries to the Economic Crime Levy Team on economiccrimelevy@gamblingcommission.gov.uk .