EuroMillions Tax

EuroMillions prizes are taxed in three of the nine participating countries – Portugal, Spain, and Switzerland – so you will not receive the full advertised amount if you play in one of these locations.

If you win a prize in the UK, Austria, Belgium, France, Ireland or Luxembourg, you will not be taxed on your winnings. However, you can only claim a EuroMillions prize in the country where you bought your ticket, so you will have to accept the local rules on tax even if you are not a resident of the country.

The issue of tax can also become more complex as your winnings accrue interest, or if you wish to give away any of your money, even if your country doesn’t withhold tax on the initial payment. Find out more about EuroMillions taxes in each country below.

Written by Alex Kiam

• UK
• Ireland
• Switzerland
• Luxembourg
• Belgium
• France
• Austria
• Spain
• Portugal

Are Lottery Winnings Taxed in the UK?

All lottery prizes in the UK are awarded tax-free, regardless of how much you win or which game you play. Lottery winnings are not treated as income by HM Revenue & Customs, which is the government department responsible for taxation. Even the EuroMillions jackpot is paid out tax-free, so whether you win £2.50 or £125 million, you will be paid the full amount.

UK Tax Implications

Inheritance tax (IHT) is paid when a UK resident dies and their estate is worth more than £325,000. Everything above that threshold will be taxed at 40 percent. If you win a large EuroMillions prize and your estate exceeds the £325,000 valuation, you should be aware of the rules regarding IHT and how it will affect your heirs.

It is very common for big winners to want to share their jackpot in some way, but if you want to make a gift without paying tax you must meet one of the following criteria:

• Give the gift more than seven years before you die.
• Give the gift to your husband, wife, or civil partner.
• Give less than your annual allowance of £3,000.

The seven-year rule is in place to stop people from giving money away just before they die so that they can avoid IHT. As long as you live for at least seven years after making your gift, you can give as much as you want to whoever you want without it being liable for IHT.

If you were to die within seven years, the recipient would have to pay IHT based on a sliding scale. The rate of tax is the full 40% if there are less than three years between you giving your gift and dying, and then it goes down to 32% in years three to four, 24% in years four to five, 16% in years five to six and 8% if there are between six and seven years between your gift and your death.

Any gifts made to your spouse or civil partner are exempt from IHT, so it would not matter if you died within seven years. You can also give gifts to any registered charity without being liable for tax, along with some national organisations, such as the National Trust, universities or museums.

You can also take advantage of the £3,000 ‘gift allowance’ each year without incurring IHT. If you give away more than this amount and pass away within seven years, the recipient would have to pay tax. It is possible to carry over your leftover allowance from one tax year to the next, but only up to a maximum of £6,000.

Other Tax-free Gifts

You can also give smaller gifts of up to £250 to as many people as you want without them being subject to IHT, although this would not include anyone who has already received gifts totalling the whole £3,000 annual exemption.

Wedding gifts can also be exempt from IHT, but only if they are made before the wedding and there has to be proof that the marriage does go ahead. You can make wedding gifts of up to £5,000 to a child, £2,500 to a grandchild or great-grandchild or £1,000 to anyone else. You can also make gifts to help pay the living costs of an ex-spouse, an elderly dependent or a child.

Syndicates

Lottery rules in the UK stipulate that only one person can be paid a prize, so when playing in a syndicate it is essential to have a formal agreement in place to show to tax authorities. This will prove the money was not just a gift and that everyone is entitled to their share. Anyone playing in an informal syndicate should be aware that they may have to pay inheritance tax on the full amount if the syndicate leader dies within seven years of the prize money being shared.

Tax on Interest

Most people can earn some interest from their savings without paying tax, but this might not be the case if you win a large enough EuroMillions prize. While there is no tax on the initial sum paid into your account, it may be that the win starts to produce an income through interest. This will then be taxed as part of your normal income tax.

What to Do About Tax Issues

EuroMIllions is tax-free in the UK, but when you win a large prize there are wider tax issues to consider such as your inheritance, gifts to others and the income that may be generated through interest.

When you win a large lottery prize, you will have the chance to speak to experienced advisors who have guided other lucky players through what to do with their newfound wealth. They will be able to point you in the direction of financial experts and will recommend the most appropriate banks for you to open an account with based on your own circumstances.

With regards to the issue of IHT, it is a good idea to think carefully about the timing of any gifts you plan to make, and then keep a record of any payments. Your financial advisor will also speak to you about the tax on your interest and discuss possible investments to give you the maximum benefit. It may be a complicated topic, but any advice you receive will be tailored to your own personal situation and one very positive aspect is that your prize will not be subject to the same sort of tax laws as it would be in other countries.

EuroMillions Taxes vs Other Lotteries

EuroMillions offers some of the largest jackpots in the world, and the fact that prizes are not taxed in six of the nine countries makes it stand out even more in comparison with some of the other big lotteries.

American games such as Powerball and Mega Millions, for example, have tax obligations at both a state and federal level, so although these games regularly offer the biggest jackpots out of any lottery in the world, the payouts can end up significantly lower than the pre-draw estimate.

New Yorkers suffer heavier taxes than anyone else in the U.S. In December 2018, one player from the state won a Powerball jackpot advertised at $298.3 million, but they ended up walking away with a significantly lower sum. They opted to take a cash lump sum of $180.3 million, which worked out as a final payout of $114 million – around 40% of the advertised jackpot – after taxes had been deducted.

In EuroMillions, you will be given the specified amount with no deductions if you play in a country which does not tax winnings, such as the UK. The UK player who anonymously claimed £122 million in April 2021, for example, received a much larger payout than the $298 million Powerball winner, even though at first glance it would seem they had not won as much.

Are Lottery Winnings Taxed in Ireland?

EuroMillions prizes in Ireland are paid out as tax-free lump sums. If you win a few Euros, you’ll be able to collect it from your local retailer. Win a nine-figure jackpot and it will be paid into your bank account, completely free of tax. However, there are several issues that you may want to consider if you win a large prize.

It is normal for big winners to want to share some of their wealth with family, but it could well end up being taxed. Capital Acquisitions Tax (CAT) is the withholding on money or property that is gifted, or inherited, by someone. The current rate of inheritance tax in Ireland is 33%. The threshold varies depending on the relationship between the donor and the beneficiary, but for children it is €335,000, so any money or property valued beyond this point will be taxed at that level. If you gift someone €3,000 a year, it is tax-free.

Tax on Interest

A big EuroMillions prize itself is not taxable, but if you invest it and start to earn an income from that money, this may be subject to taxation. The rate for the highest earners in the country is 40%. The Irish Lottery will be able to put you in touch with expert financial advisors if you are lucky enough to pick up a big prize.

Are Lottery Winnings Taxed in Switzerland?

There is a levy of 35% in Switzerland on any winnings over CHF1 million. This is the highest percentage of any participating EuroMillions, although it does only apply to new millionaires. The vast majority of prizes are unaffected by any sort of charge.

If you win a significant prize in Switzerland, the best course of action is to seek out a local financial expert, as the whole tax system varies considerably depending on which of the 26 cantons you live in. One feature that is common throughout the country is a wealth tax, which is based on your net worth. The wealthiest people, which would include a EuroMillions jackpot winner, have to pay this tax at rates between 0.3% and 0.8%.

Inheritance taxes are applied throughout the cantons, although gift taxes are becoming less and less common. Income tax is levied by both the federal government and your canton, but it may be that your win starts to produce an income through interest. This will then be taxed as part of your normal income tax.

Are Lottery Winnings Taxed in Luxembourg?

Lottery winnings in Luxembourg are awarded tax-free. Even if you became the country’s biggest-ever winner and landed a prize of more than €200 million, you would be paid the full amount.

You should still be aware of the local tax laws, as there could be implications further down the line. For example, inheritance tax increases on a sliding scale as the value of the inheritance increases. There is also income tax to consider if your prize starts to produce an income of its own. The top rate of 42% is levied on earnings above €200,000.

Are Lottery Winnings Taxed in Belgium?

There is no tax on lottery winnings in Belgium. It does not matter how much you win, whether it is €4 for matching two numbers or €140 million for matching all seven, you will receive the publicised amount in full. However, there are still a number of considerations to be aware of if you are lucky enough to win a major prize.

Inheritance tax varies from region to region (it is paid to the region where the deceased was a tax resident for the majority of the last five years of their life), but there is a progressive rate throughout the country. In most regions it rises to 30% for inheritances worth more than €500,000 for spouses or direct descendants (a higher rate applies if the beneficiary is someone else, for example a sibling, uncle or nephew). If you win a large prize, you should consult a financial expert regarding the rules on estate tax.

Are Lottery Winnings Taxed in France?

EuroMillions is tax-free in France. Lottery winnings do not count as income, so you are guaranteed to receive your full prize, even if you have won a Superdraw jackpot. Nevertheless, there can be issues relating to tax if you do win a significant amount.

Droits de Succession

Taxes can apply to both gifts and inheritances. There is a 15-year rule on gifts, so any money that is gifted to someone will only remain free of tax if the donor stays alive that long (provided it does not exceed the exemption limits). If the donor dies in that period, the prize becomes taxable. The limits that can be gifted free of tax vary, depending on the relationship between the two parties, but children can receive €100,000 from each parent as a tax-free allowance. The rate of withholding increases for amounts beyond that value, ranging from 5% to 45%.

Tax on Interest

France previously had a specific wealth tax, so individuals with a net worth of more than €1.3 million were automatically hit with a charge, but it was abolished in 2017 by Emmanuel Macron. However, you may still have to pay tax on the interest that a big win accrues. The highest rate is 45%, although this only applies to people whose annual income is far more than €150,000.

Are Lottery Winnings Taxed in Austria?

All lottery prizes in Austria are awarded tax-free, regardless of how much you win or which game you play. Lottery winnings are not treated as income, so whether you win €3.50 or €100 million, you will be paid the full amount.

The gift tax and inheritance tax were cancelled in 2008, so there aren’t many of the issues that there are in certain other countries. This is particularly beneficial if you are looking to share a big prize, or you are concerned about how you the value of your estate might affect your heirs.

Tax on Interest

Most people can earn some interest from their savings without paying tax, but this might not be the case if you win a large enough EuroMillions prize. While there is no tax on the initial sum paid into your account, it may be that the win starts to produce an income through interest. This will then be taxed as part of your normal income tax. The tax rate for the highest level of income in Austria is 55%, for those people whose yearly income exceeds €1 million. If you won a Superdraw jackpot, for example, you would have to be wary of the tax implications.

Are Lottery Winnings Taxed in Spain?

Spanish prizes of more than €40,000 are subject to tax at 20%. There’s no withholding on payouts of a lower value, but if you are lucky enough to win the jackpot there is a price to pay in comparison with most other countries. If you won a Superdraw jackpot of €130 million, for example, almost €26 million (the first €40,000 would be tax-free) would be withheld and you would receive €104 million. The tax goes to the administration agency known as the Agencia Tributaria.

If you are keen to share a big win, or leave the money to relatives when you die, you should be aware of the rules on inheritance tax. The rates are set by the national government and are progressive, with an upper limit of 34%.

Gift tax is treated in the same way as inheritance tax, and there are no tax allowances for it. You must therefore pay tax on any money that is gifted to you. You must declare gift tax within 30 days of the date it was presented to you.

One of the first things you should do if you win is speak to a financial advisor, as you may also have to pay tax on the interest that your prize generates if it is substantial enough. The income tax rates in Spain vary from region to region, but the top band is generally higher than 40%.

Are Lottery Winnings Taxed in Portugal?

In Portugal, any prize worth more than €5,000 is taxed at a rate of 20%. For example, if you won a EuroMillions jackpot of €100 million, the contribution back to the government would be almost €20 million (the first €5,000 would be tax-free). There is no cost to you if your prize is lower than €5,000.

There is no Inheritance tax imposed in Portugal, so big winners do not need to worry about their loved ones being hit with a major tax bill. There is a 10% stamp duty when assets are passed on death or as a lifetime gift, but spouses and children (or grandchildren) are exempt. Some people may have to pay administration fees, particularly if their heirs are not Portuguese.

Tax on Interest

As well as having to pay tax on major prizes in Portugal, there is further expense if the interest is large enough to start producing an income of its own. The income tax can be as high as 48% for the top earners. It is recommended that you consult a tax expert if you win more than €5,000 in Portugal, and particularly if you claim a jackpot.