How to start a competition website in the UK

What the market looks like

The best public figures come from research DCMS commissioned in 2023 and quotes in its Voluntary Code: the UK prize draw market was worth around £1.3 billion a year, with 7.4 million adult participants and over 400 operators. The same research found that 88% of prize draw participants had also taken part in commercial gambling or lotteries in the previous 12 months, compared with 60% of adults in the general population. That is one reason the sector now has a code of practice.

Our own data shows how crowded it has become. On 28 October 2026 our directory listed 1,067 active UK companies with competition-related names on the Companies House register. 349 of them were incorporated in 2025 and 328 so far in 2026. Not every one of them trades, but it tells you that a good name, a trustworthy site and clear compliance matter. You can see the latest registrations on our new companies page.

Step 1: choose your legal model

Under the Gambling Act 2005, section 14, an arrangement where people pay to enter and prizes are allocated wholly by chance is a lottery. Lotteries can only be run by licensed or registered bodies, such as society lotteries, so a commercial comp site has to stay outside that definition. There are two recognised ways to do it:

• A genuine prize competition. Success depends on skill, knowledge or judgement that is hard enough to stop a significant proportion of people entering or winning (section 14(5)). Prize competitions are not gambling (section 339).
• A prize draw with a free entry route. Paid entry is allowed if there is a genuine free alternative, such as entry by ordinary post, that meets the conditions in Schedule 2, paragraph 8.

Most UK comp sites use a free entry route, and many add a question too. Read Prize competitions vs lotteries before you build anything. Get this wrong and the whole business is at risk.

Step 2: plan for the DCMS Voluntary Code

In November 2025 DCMS published a Voluntary Code of Good Practice for Prize Draw Operators. It covers paid prize draws with a free entry route in Great Britain. It sets expectations on age verification, credit card limits, spend limits, account suspension, draw fairness and transparency. Our signatory list shows 138 operator signatories and 30 other relevant signatories (platforms and suppliers). New signatories are expected to comply from the day they sign, so build these features in from the start. See the DCMS Voluntary Code explained.

Step 3: set up the business

• Company. Most operators trade through a private limited company. Registering with Companies House costs £100 online (£124 by post). You need to verify your identity, give a registered office address and list the people with significant control. Applications are usually processed within 24 hours.
• Tax. You will need to register for Corporation Tax. VAT needs specific advice. In a written answer to Parliament in February 2026 (UIN 111960), the Government said HMRC's position is that prize draws offering both paid and free entry routes are not eligible for VAT exemption, so paid entries are subject to VAT at the standard rate of 20%. The VAT registration threshold is £90,000 of taxable turnover. Speak to an accountant who knows the sector before you set your prices.
• Data protection. Organisations that use personal information need to pay the ICO data protection fee unless they are exempt. You will also need a privacy notice.

Step 4: name, brand and domain

Your name has to be available at Companies House and should not clash with an existing trade mark or comp brand. It also needs to work for an adult-only product. See naming and branding a competition site, search our brand directory for clashes, and see the ready-made domains in our marketplace.

Step 5: choose a platform

Our recommendation: use a dedicated hosted competition platform. From our own experience running a competition site on WordPress, we don't recommend building one on WordPress/WooCommerce plugins. We had poor performance, a database that grew huge because every entry was stored as an order, and server problems under heavy traffic at launches and draws. On top of that, plugin conflicts, security upkeep and bolting on compliance features take up time you would rather spend on prizes and players. Hosted platforms usually include draws, instant wins, free-entry handling and player-protection tools as standard. Our platforms directory compares RaffleHub, RaffleX, Comps.gg, Turbo IT, Basecomp, Rokker Prio, ByteStack on what they publish. Read how to choose a competition platform.

Step 6: arrange payments

Many mainstream payment providers restrict or exclude paid-entry prize promotions, so plan this early. The platforms we list name specialist acquirers such as Cashflows on their websites. The DCMS Code also limits credit card use. See taking payments for a competition site.

Step 7: rules, draws and prizes

Before launch you need written terms and competition rules, ideally reviewed by a solicitor who knows prize promotions. The CAP Code and the DCMS Code together expect:

• significant conditions, including how to enter for free, closing dates, age limits and the promoter's name and address, stated clearly before entry (CAP 8.17);
• prize draws run according to the laws of chance, by an independent person or a verifiably random computer process, with free and paid entries having an equal chance (CAP 8.24; DCMS 2.2);
• details of the draw mechanism published on your website (DCMS 2.2);
• prizes awarded as described, normally within 30 days (CAP 8.15.1), with no reduced prizes, moved draw dates or cancellations because sales were low (DCMS 2.5).

Don't list a prize you cannot afford to award if sales are slow.

Step 8: market responsibly

Comp marketing is covered by CAP Code section 8, ASA rulings on social media giveaways, platform advertising policies and the DCMS Code's rules on targeting under-18s. See marketing rules for competition sites. When you're ready to reach other operators and suppliers, see advertising on Competition Brands.

Launch checklist

• Legal model chosen and documented (skill test and/or free entry route)
• Terms, rules and privacy notice reviewed by a solicitor
• Company registered; Corporation Tax, VAT position and ICO fee dealt with
• Age verification, spend limits (including £0), suspension and self-exclusion in place
• Draw method published; free entries handled with an equal chance
• Payment account approved for your business model, in writing
• Complaints process and support signposting live
• Winners' publication process (with opt-out) ready

Frequently asked questions

Sources

• Gambling Act 2005, section 14 (lottery; skill test)
• Gambling Act 2005, section 339 (prize competitions)
• Gambling Act 2005, Schedule 2 (payment and free entry)
• Gambling Commission: free draws and prize competitions
• DCMS: Voluntary Code of Good Practice for Prize Draw Operators
• CAP Code, section 8: promotional marketing
• Companies House: register your company
• HMRC: register for VAT
• UK Parliament written question UIN 111960 (VAT on prize draws), answered 17 February 2026
• ICO: data protection fee

Sources checked 29 October 2026.