Cash Raffles - Are They Legal?

If you're planning to hold a fundraising event that has a raffle as it's main focus, there are a number of legal issues that you must adhere to in order for the event to fall in line with fundraising laws.

Holding a raffle can be a fun and easy way to raise money for a good cause. Many people decide to hold a raffle as it's easy to buy books of tickets and sell them in groups. Most people will support raffles as it doesn't require much from them and it's often a fun way to try and win a prize. There are a few legal issues with raffles however and one in particular means that you are not able to offer a cash prize as part of a raffle.

Raffle's are considered to be a 'small lottery' in the eyes of the law. This means that you are only able to offer no more than 250GBP for prizes and you can't award cash prizes. You can award donated gifts up to the value of 250GBP, but under no circumstances can you give cash back.

Another important point to consider with raffles is that there is no limit on the price of a ticket, but you must ensure that you're selling the tickets only within the time and place of the raffle. Generally most people will sell a strip of tickets for a certain price and draw the raffle there, when everyone is present. Larger organised events require a licence from your local authority and the type of event you're discussing seems to fall under this as you'd like to pre-sell tickets and offer cash as a prize. You should speak to your local authority about this.

The three categories of exempt lottery which do not require any kind of authorisation by a local authority are:

  • Customer lotteries – business owners run these and only sell tickets to customers
  • Private society, work or residents lotteries – tickets are only sold to members
  • Incidental non-commercial lotteries – must be held at non-commercial events and all money must be given to a charity or fundraising group

Even within these exempt groups there are relevant rules and regulations that must be followed. If you're still unsure, consider contacting the Institute of Fundraising on 020 7840 1000.