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URGENT! Are gift cards won from playing games taxable income?

I just googled it and found out they are taxable, I won a £20 voucher earlier in the year for playing games on an app while I was signing on and didn't declare it as income as I didn't know it counted I thought only actual money counted. There's nothing I can do about it now as I signed off a couple of months ago and doubt I could log into my account now, I was probably overpaid, I'm worried now what do I do?

Edit I've managed to log in to my universal credit account and the £20 voucher wouldn't have affected the amount I was paid, I had a loss that month as I had business expenses that were higher than what I earned even with the £20 voucher it was still a loss a smaller loss but still a loss as I still earned less than what the expenses were so I was paid the maximum amount I could have gotten but it my have affected the few months after as my income was low but because of the expenses of that month they were being carried on the next months so I my have been overpaid. Do I need to contact them? I can't through my account as my claim was closed, only claimants can contact them and they'll probably be closed for the Christmas/new year break but should I call them after?
(edited 10 months ago)
Original post
by Anonymusy
I just googled it and found out they are taxable, I won a £20 voucher earlier in the year for playing games on an app while I was signing on and didn't declare it as income as I didn't know it counted I thought only actual money counted. There's nothing I can do about it now as I signed off a couple of months ago and doubt I could log into my account now, I was probably overpaid, I'm worried now what do I do?

Edit I've managed to log in to my universal credit account and the £20 voucher wouldn't have affected the amount I was paid, I had a loss that month as I had business expenses that were higher than what I earned even with the £20 voucher it was still a loss a smaller loss but still a loss as I still earned less than what the expenses were so I was paid the maximum amount I could have gotten. Do I still need to contact them? I can't through my account as my claim was closed, only claimants can contact them and they'll probably be closed for the Christmas/new year break but should I call them after?

(Caveat: I'm no expert on Universal Credit.)

I think perhaps you're confusing different concepts: whether you owe tax on the £20 voucher you received, and whether the receipt of a £20 voucher impacts your Universal Credit. These are different concepts with different rules.

I'm going to assume that as you've said that you "won a £20 voucher earlier in the year" that this was the result of gambling. Is that correct?

It's important for a couple of reasons:
(1) In the UK, the proceeds of gambling are not taxable (instead, the organisation providing the gambling services are taxed).
(2) Gambling proceeds do not meet the definition of earnings within Universal Credit Regulation 52 and are not taken into account as unearned income.

However, gambling proceeds are considered "capital" and, as I'm sure you know, your entitlement to Universal Credit reduces if you have capital (e.g. money, savings, investments) in excess of £6,000. Do you?

That's the only theoretical impact that I can see this £20 voucher having. And even then, you're entitlement reduces by £4.35 for each £250 you have in capital above £6,000. So if this £20 doesn't take you into the next £250 band, then it has zero impact anyway.

Reply 2

Original post
by DataVenia
(Caveat: I'm no expert on Universal Credit.)
I think perhaps you're confusing different concepts: whether you owe tax on the £20 voucher you received, and whether the receipt of a £20 voucher impacts your Universal Credit. These are different concepts with different rules.
I'm going to assume that as you've said that you "won a £20 voucher earlier in the year" that this was the result of gambling. Is that correct?
It's important for a couple of reasons:
(1) In the UK, the proceeds of gambling are not taxable (instead, the organisation providing the gambling services are taxed).
(2) Gambling proceeds do not meet the definition of earnings within Universal Credit Regulation 52 and are not taken into account as unearned income.
However, gambling proceeds are considered "capital" and, as I'm sure you know, your entitlement to Universal Credit reduces if you have capital (e.g. money, savings, investments) in excess of £6,000. Do you?
That's the only theoretical impact that I can see this £20 voucher having. And even then, you're entitlement reduces by £4.35 for each £250 you have in capital above £6,000. So if this £20 doesn't take you into the next £250 band, then it has zero impact anyway.

No it wasn't gambling, there are apps/websites such as that you can download/use and play video games in exchange for cash or vouchers/gift cards or other rewards, I earned £20 from playing video games through this app and when you cash out there's an option of getting a £20 Amazon voucher, £20 in cash sent to your PayPal and there was another £20 option. I chose the Amazon voucher because before that I made £20 and when I tried to cash out through PayPal I never received the cash and to this day I still haven't received it, it's disappeared from the app like it never happened and the reviews for that app have said they never received cash or got it many months later but the Amazon vouchers always work so I picked the Amazon voucher and it worked
Original post
by Anonymusy
No it wasn't gambling, there are apps/websites such as that you can download/use and play video games in exchange for cash or vouchers/gift cards or other rewards, I earned £20 from playing video games through this app and when you cash out there's an option of getting a £20 Amazon voucher, £20 in cash sent to your PayPal and there was another £20 option. I chose the Amazon voucher because before that I made £20 and when I tried to cash out through PayPal I never received the cash and to this day I still haven't received it, it's disappeared from the app like it never happened and the reviews for that app have said they never received cash or got it many months later but the Amazon vouchers always work so I picked the Amazon voucher and it worked

OK, so not gambling. Does the word "won" in the thread title and your original post refer to it being a prize then, by gaining the highest score or whatever? Or is the word "earned", which you've used in your most recent post, more correct?

If it's money you've received for providing a service (playing a video game in this instance) then it will meet DWP's definition of unearned income, and is reportable.

It's probably worth calling them after Christmas / New Year and explaining what's happened. You've checked the impact of having received this £20 voucher, and established there is none, so contacting them may be unnecessary. But technically you should do so. And it'll give you some peace of mind, I suspect.

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