The prizes paid corresponding to lotteries and bets organized by the Sociedad Estatal Loterías y Apuestas del Estado (SELAE) are subject to taxation through a special tax (L 16/2012).
This regulation establishes that the recipients of these prizes, whatever their nature, at the time of collection, are subject to a withholding or payment on account that must be made to them by the body paying the prize, i.e. SELAE. This is required independently with respect to each winning lottery ticket, fraction or lottery coupon or bet.
On the other hand, prizes whose full amount is equal to or less than 10,000 euros are exempt. The prizes whose full amount is greater than 10,000 euros are only taxed with respect to the part of the prize that exceeds this amount.
The base of the withholding of the special tax is formed by the amount of the prize that exceeds the exempt amount. The percentage of withholding or payment on account is 20%.
Thus, for example, a prize of 100,000 euros is taxed at 20% on 90,000 euros (100,000 - 10,000 ) , so a withholding of 18,000 euros is made and 82,000 euros would be received.
SELAE must proceed to identify the winners of the prizes subject to taxation, that is to say, those that are greater than 10.000€ per tenth, regardless of whether the prize has been obtained by a single person or jointly by several persons or entities.
In the case of shared prizes (group of friends or relatives, clubs, brotherhoods...), in which the prize is distributed among all the participants, the 10.10,000, which is exempt, among all the beneficiaries in proportion to their percentage of participation, and whoever proceeds to the distribution of the prize who appears as the sole beneficiary (or as the collection manager), having declared it at the time of the prize collection, must be able to prove to the Tax Administration that the prize has been distributed to the holders of participations, being therefore necessary the identification of each winner as well as their percentage of participation.
The IRPF taxpayers or the non-resident taxpayers without permanent establishment who are winners and have paid the withholding at the moment of the payment of the prize do not have to file any other self-assessment.
Additionally, nonresident taxpayers without a permanent establishment who are winners and have paid the withholding at the time of the payment of the prize may request the refund that may correspond to them by application of an agreement to avoid international double taxation.
IS taxpayers who obtain a prize subject to the special tax must include, as they did before 1-1-2013, the amount of the prize among the income for the period subject to the tax and the 20% withholding/payment on account borne as a further payment on account.
Source: AEAT
