Autumn Budget 2026: Changes for Remote Gaming Duty on certain promotional games. Another rate rise, by stealth?

Tucked away in the Budget 2026 documents is an announcement that the government will introduce legislation in Finance Bill 2026-27 to "put beyond doubt" the Remote Gaming Duty (“RGD”) treatment of free plays, prizes and tournaments, with effect from 1 April 2027. The changes appear aimed at the incentive arrangements at the heart of two recent cases which HMRC lost: 

• L & L Europe Ltd v HMRC [2024] UKFTT 00144 (TC) (“L&L Europe”), which allowed an RGD deduction for certain cashback arrangements; and
   
• Jumpman Gaming Ltd v HMRC [2026] UKUT 00364 (TCC) (“Jumpman”), which allowed certain free plays (namely, free plays won from free games) to be, when used, exempt from RGD. You can read our legal update on the Upper Tribunal’s decision in Jumpman here. It is not yet known whether the Upper Tribunal decision is subject to appeal.

What has been announced so far?

The measure will amend the RGD provisions in Finance Act 2014 (FA 2014), specifically the current law on free plays and prizes in sections 155 to 160 FA 2014, and the relevant tournament provisions in section 188 FA 2014. In summary, the Finance Bill 2026-27 will:

• Replace free plays with "restricted plays": section 159A FA 2014 will be “replaced” (NB “replaced”, not “amended”) with new provisions for restricted plays. Restricted plays will comprise offers that waive all or part of a gaming payment, and non-withdrawable money provided by or on behalf of the gaming provider.  Comment: These are the provisions that are the subject of the Jumpman litigation. 
   
• Exclude certain restricted plays won from restricted plays: the legislation will set out when a restricted play won from the use of another restricted play is excluded for RGD calculations. The won restricted play will be excluded where no other benefit is offered in place of it.  Comment: The new provisions will, no doubt, narrow the scope of the current relieving provisions to align with HMRC’s view of how it considers those rules should be interpreted (the view which the Upper Tribunal recently rejected).
   
• Amend the tournament rules: the legislation determining when participation in a tournament is treated as playing a game of chance will be amended. Comment: This change appears to be targeted at the definition of “gaming” for RGD purposes, which is central to the question of whether a game is within the scope of the RGD rules.  Games need to be within the scope of the rules for cash prizes to be deductible.
   
• Narrow the meaning of "prize": something will only be a prize where it is required to be paid or provided under the published rules of the game. The legislation will also specify the circumstances in which the return of a gaming payment following the interruption or termination of a game may be treated as a prize for RGD calculations.  Comment:  This change appears targeted at the cashback arrangements central to the L&L Europe case.
   
• Give HMRC regulation-making powers: the Commissioners for HMRC will be able to make regulations about when a gaming payment is, or is not, treated as waived, and when an amount paid or required for participation in a tournament is to be disregarded. Comment: This change is to enable government to make further changes more swiftly (i.e. via statutory instrument, rather than primary legislation).

The changes will take effect from 1 April 2027.

What does this mean in practice?

In effect, the government is looking to reverse the effects of L&L Europe and to apply HMRC's preferred interpretation of the FTT's decision in Jumpman (i.e. at first instance, where HMRC won, before the Upper Tribunal overturned that decision).  From HMRC's perspective, these changes will "deal with the future".  For operators offering relevant incentives, this is likely to result in a choice: stop offering affected promotions, or pay (even) more RGD?

Whether HMRC will also seek to "deal with the past" (in relation to the RGD treatment of free spins won from free games) by securing permission to appeal the Upper Tribunal’s decision in Jumpman is, at present, unknown. 

How other player incentives will be affected is less certain at this stage.  A clearer picture should emerge once the draft legislation is published.

The overall impact on operators will depend on the extent to which they use the promotions that HMRC clearly has in its crosshairs.  Operators offering free-to-play games, free spins, cashback or similar promotions should review those arrangements ahead of 1 April 2027.