Free Spins After Jumpman: Britain Sets Out Its Tax Rewrite

Jumpman’s dispute concerned approximately £13.2 million of Remote Gaming Duty (RGD) assessed for periods between July 2018 and December 2022.

A qualifying deposit gave a customer a spin on its Mega Reel promotional game, which could award further spins on other games. The tax treatment depended on both stages.

The initial welcome game was found to be inherently free. There was no ordinary participation payment being waived. The contested question was whether the subsequent spins fell within a statutory exclusion, even though they had been won through that free game.

Jumpman lost its appeal at the First-tier Tribunal in 2025. On 25 September 2026, the Upper Tribunal accepted its interpretation of the exclusion. The welcome game remained outside the charge, and the further spins also escaped liability under the provisions considered. The disputed assessments were to be reduced to nil.

That outcome explains the significance of the drafting now before Parliament. The connection between the first game and the spins it produces is central to the next set of rules.

Clause 82 would replace section 159A of the Finance Act 2014. Its definition of restricted play covers participation involving either provider-funded, non-withdrawable money or an offer waiving a gaming payment, with conditions concerning alternative benefits.

The exclusion for subsequent play would then depend on the money or offer having been won from restricted play. Restrictions on using the benefit outside remote gaming, or receiving an alternative benefit, also form part of the test.

For an arrangement like the one examined in Jumpman, this changes the question that must be asked about the first stage. A wholly free game that involves neither a waived payment nor the specified use of non-withdrawable money would not automatically qualify as restricted play. The exclusion for spins generated by that game would consequently need to be reassessed against the new wording.

There is also a more accommodating element in the package. The explanatory notes describe an extension of exclusions for chains involving non-withdrawable money, bringing them into line with qualifying chains that begin with a waived-payment offer.

The practical result is a more specific classification exercise. Operators would need to establish how an entitlement arose and what the customer could do with it. The words “free spins” on a promotional banner would reveal very little of that history.

Mixed payments add an operational test. The draft separates the qualifying restricted element from other money used in the same play. A platform reporting only one combined stake figure could leave the operator with more work to establish the correct treatment.

Free spins are one part of a wider dispute about what belongs in the duty calculation.

In February 2024, L & L Europe won a First-tier Tribunal appeal concerning £807,284 of RGD. Its arrangement allowed qualifying customers who had lost their session deposits to claim 10% cashback. The tribunal accepted that the payments qualified as prizes for the calculation. The case concerned cash belonging to the customer, rather than further restricted spins.

The new Bill would require a prize to be provided in respect of participation in a game and as required by its published rules. Its explanatory notes distinguish that requirement from discretionary or arbitrary awards, referring to cashback and rakeback schemes as examples.

That makes the underlying obligation important. Whether a payment is a required game prize, a discretionary retention offer or a returned stake has consequences. A blanket assumption that every cashback arrangement receives identical treatment would miss those distinctions.

Returned gaming payments are addressed separately. The proposed conditions concern games interrupted or terminated without a determinable outcome, where the interruption is outside the payer’s control and the provider must return the payment.

Tournaments receive a separate test involving a participation payment, its relationship to charges for the underlying games, and prizes determined by participant rankings. Operators would have to examine the structure of the competition before reaching a tax conclusion.

These proposals arrive in a market where the existing duty burden has increased substantially.

RGD rose from 21% to 40% on 1 April 2026. It applies to the defined remote-gaming profit calculation, which takes account of gaming payments and deductible prizes. That tax measure can include the notional value of qualifying promotional play even when no corresponding cash stake arrives from the customer.

This is why the rate and the definition of the taxable amount need separate attention. At a higher rate, the treatment of a promotion can have greater commercial significance. Counting a bonus’s advertised value as though it were either cash revenue or its complete delivery cost gives an incomplete picture.

The operator still has to meet prize costs and pay for software, payments, staff and marketing. The return from customers acquired through the promotion must cover the relevant costs over time. A tax treatment that appears favourable in isolation cannot establish that the campaign is profitable.

Our recent examination of Super Group’s opportunity in the UK market considered a related problem: attracting business as competitors retreat can improve an operator’s position while leaving a demanding test of earnings after duty. The design of bonuses sits directly inside that calculation.

HMRC’s October impact note presents this measure as reinforcing existing policy. It forecasts no additional Exchequer revenue and describes the administrative burden as negligible, with possible familiarisation costs.

That official assessment deserves space in the story. The government is presenting a clarification intended to protect the revenue system and reduce disputes, rather than announcing a separately scored increase in receipts from this measure.

It does not follow that every operator’s existing promotion would produce exactly the same result under the revised rules. The impact note describes the measure across the tax system; a particular offer depends on its own terms and transactions.

Our reading is that the greatest uncertainty sits around arrangements whose commercial case relies heavily on a contested interpretation. If that treatment changes, the operator must reconsider the cost of the offer, the customers it attracts and the business those customers subsequently generate.

Possible responses include smaller promotional budgets, different reward structures or greater emphasis on service and retention. These are commercial scenarios. The Bill does not establish that Jumpman, or every other casino operator, has decided to reduce its offers.

Clearer legislation has value for both the state and businesses. A dispute covering several years of activity ties tax administration to decisions made long after the original campaigns have finished. More predictable treatment can help operators price promotions and make investment decisions with greater confidence.

There is an equally important discipline on government. A tribunal interprets the law applicable to the dispute before it. Ministers can ask Parliament to change that law for the future. Describing a policy as a clarification should not blur the difference between those two processes or diminish the taxpayer’s successful appeal.

For operators, our preference is for a bonus strategy that remains commercially defensible when its full costs are visible. Useful rewards, understandable conditions and a service customers choose to return to offer a firmer foundation than an elaborate promotional sequence dependent on a narrow tax interpretation.

For players, the practical test is the offer they receive. A change to an operator’s duty calculation does not itself impose RGD on a customer’s withdrawal. Its possible effects would come through commercial decisions about rewards, budgets and terms.

Those decisions remain subject to consumer-protection requirements. Since 19 January 2026, Gambling Commission rules have capped wagering requirements on bonus funds at ten times. The rules also require incentive terms to be clear, fair and accessible. Pressure on margins does not remove those obligations.

We would therefore judge any redesign by how clearly it explains eligibility, the reward and withdrawal conditions. An offer with fewer spins and straightforward terms may be more useful than a larger headline number whose practical value is difficult to establish.

The next milestones are the Bill’s passage, any amendments to clause 82 and the detail of implementation. The draft also provides a power for HMRC to make regulations about when a gaming payment is treated as waived, giving future rules a potential role in this boundary.

The proposed start date for the main changes is prospective. The Bill does not, by itself, establish that other operators are entitled to refunds for earlier periods. Those questions depend on the applicable law, the arrangements involved and the relevant procedures.

Jumpman’s victory remains an important demonstration of the consequences of statutory wording. The government’s response now gives the industry a new text to examine. The next generation of bonus offers will need to earn their place after prizes, duty and operating costs, while giving players terms they can readily understand.