Fruit machines in a pub in 2026: what one really earns, the 20% duty you pay, and what the Pubs Code says about the tie

The BBPA's own survey puts a pub fruit machine at about £103 a week for an older analogue machine and £309 a week for a digital one. Out of what the machine takes, net of winnings paid out, 20% goes to HMRC as Machine Games Duty, and if you're the tenant, that bill is yours, not the pubco's. You can have two machines on a simple £50 notice to the council. And if your pubco owns 500 or more tied pubs, any tenancy agreed or renewed since 21 July 2016 can't make you rent or buy your machines from them.

Machines get talked about in two ways in this trade. Either they're the thing keeping the lights on, or they're a box in the corner taking up a table. Both can be true depending on the pub and the machine. What nobody tends to do is sit down with the actual numbers, so here they are, from the BBPA, HMRC and the Gambling Commission, with the sums worked through.

What a machine actually takes

Three sets of figures are floating around. They measure slightly different things, so don't expect them to line up to the pound.

Source	Figure	What it measures
BBPA annual survey (2023 data, in the June 2024 BBPA tenant cost guide)	£103 a week per analogue machine, £309 a week per digital machine	Average weekly balance per machine
Same BBPA survey	£389 a week	Average weekly house takings for a leased or tenanted pub that has machines
UKHospitality, reported by Business Matters, November 2025	£622m a year across about 36,700 machines in nearly half of UK pubs; £385m net after taxes, supplier rent and charges, roughly £8,500 a pub	Whole-sector income
Admiral Taverns, same report	About £6,000 a year net revenue per pub	Across Admiral's estate

The BBPA itself says the gap between analogue and digital is the story. There's been "a significant shift in recent years to digital machines from analogue," and on their figures a digital machine balances three times what an old one does. If you've still got a machine that looks like it came in with the pool table, that's the first conversation to have with your supplier.

One caveat. The BBPA summary doesn't spell out exactly which deductions come off before the "house" figure, so treat it as a ballpark for what a machine can do, not a promise for yours. Your own machine's meter readings are the only number that counts.

The duty: 20% of net takings, and it's on you

Machine Games Duty is charged on your net takings from the machine. HMRC defines that as what you charge to play minus what you pay out in winnings, including non-cash prizes. The rate depends on the machine.

Machine type	Cost to play	Prize	MGD rate
Type 1, lower rate	20p or less	£10 or less	5%
Type 2, standard rate	21p to £5	£11 or more	20%
All others, higher rate	More than £5	Any	25%

A pub fruit machine is a category C machine, and the Gambling Commission caps those at a £1 stake and a £100 prize. That puts the usual pub machine squarely in the 20% band. If a machine has games in more than one band, the highest rate applies to everything it takes.

Two bits of the HMRC guidance matter more than the rate:

• The tenant pays, not the pubco. HMRC's guidance says it in plain words: if you're the tenant of a pub, you're responsible for MGD rather than the premises licence owner. The firm that supplies the machine isn't responsible either.
• You register before the machine is switched on, send a return every three months, pay within 30 days of the return, and keep your machine takings records and returns for four years. There's a penalty for not registering when you should. And when your tenancy ends or the machine goes, cancel the registration, or HMRC keeps sending estimated bills, which it calls central assessments, for a pub you no longer run.

The one bit of good news: takings from machine games are exempt from VAT if you're paying MGD on them. So unlike a pint, where a sixth of the price goes in VAT, the machine's money only gets the duty.

A worked week

Say your machine shows £300 of net takings in a week, which sits between the BBPA's analogue and digital averages. These are my sums, to show the order things come off, not anyone's real machine.

Step	Amount
Net takings (cash in, minus winnings paid out)	£300
Machine Games Duty at 20%, paid by you	£60
Left after duty	£240
Supplier's cut, if your deal happens to be a straight 50/50 of what's left	£120
Yours	£120 a week

Deals vary a lot. Some suppliers take a fixed rent, some take a share, and some take the duty out before the split and some after. Get your own deal in writing and run your own numbers through that table. To put £120 a week in context, the average pint of lager carries about £2.23 of gross profit once VAT and cost come out, which is the figure I used in the Sky Sports guide. So that machine is doing the work of about 54 extra pints a week, standing in a corner.

An old analogue machine at the BBPA's £103 a week is a different picture. Take 20% duty off and split the rest 50/50 and you're at about £41 a week. That's worth having, but it's worth asking whether a digital swap, or the table it stands on, would earn more.

Permits: two machines on a notice, more needs a permit

Any pub with an alcohol premises licence is automatically entitled to two category C or D machines once it notifies the council. Reading Borough Council's page is a good plain example of how it works in practice:

• Two machines or fewer: fill in the notification and pay £50. No annual fee.
• More than two: apply for a licensed premises gaming machine permit, £150, then £50 a year. The permit replaces the automatic two, it doesn't add to them.
• Machines can only be played in the hours on your premises licence, not during a temporary event notice extension.
• If the premises licence changes hands, the new holder has to notify again.

Those are Reading's figures, so check your own council's page, but the shape is the same everywhere. Category C machines are 18 and over only. Category D, the low-stake ones like a crane grab or a penny falls, have no age limit.

The tie: what regulation 47 of the Pubs Code says

This is the bit that used to cause the most grief. Machines were often tied, so the pubco picked the supplier and took a cut.

Regulation 47 of the Pubs Code is short. A pub-owning business must not enter into a new tenancy or licence, and must not renew one, which requires a tied pub tenant to purchase or rent gaming machines. It's been in force since 21 July 2016.

What that does and doesn't mean in practice:

• It only covers pubcos with 500 or more tied pubs in England and Wales, the same firms the rest of the Pubs Code covers, and only agreements entered into or renewed since July 2016. A smaller family brewer isn't caught, and if you're on an older agreement that was never renewed, your machine clause may still stand.
• The wording is about being required to buy or rent machines. If your agreement has some other machine clause, like a share of income, read it carefully and ask in writing. If it comes up with your BDM, get it into the BDM visit notes.

If you're about to sign a tied pub, this is one to check in the draft. If you're thinking about the market rent only option, machine income is part of the trade a free-of-tie rent will be assessed on, so know what yours really does first.

The Budget on 28 October

Last year the trade was braced for MGD on machines to jump to 50%. In the end the November 2025 Budget raised remote gaming duty from 21% to 40% from April 2026 and abolished bingo duty, and the GOV.UK rates for MGD are still 5%, 20% and 25% today. The BBPA and UKHospitality spent last autumn asking for category C and D machines to be frozen, and they'll be asking again.

I don't know what's coming on 28 October and nor does anyone else outside the Treasury. I'll update this the day it's announced.

Keep the machine's money out of the till

This is the stock bit, and it's the one that quietly messes up your numbers. If machine refills come out of the till drawer, or someone empties the machine and the coins go in with the bar takings, your wet takings for the week are wrong. Then your till won't match your stocktake, and you'll go looking for a loss in the cellar that's actually sitting in a bag of pound coins.

Give the machine its own float bag. Write down every emptying and every refill with the date, the meter reading and the cash. You need four years of machine records for HMRC anyway, so it's the same job. Your bar takings stay bar takings, and your GP stays honest.

My take

A digital machine in a wet-led local that suits one is real money, and on the BBPA's numbers it's worth more than plenty of things pubs spend a lot more effort on. An old analogue machine in a food pub might not be paying for its floor space. The only way to know is your own meter readings over a couple of months, set against your supplier's deal and the 20% duty.

And if you're tied with one of the big pubcos, look at when your agreement was signed or last renewed before you assume the machine has to stay with their supplier. This is my plain read of the HMRC, Gambling Commission and Pubs Code wording, not legal or tax advice.

Common questions

How much does a fruit machine make for a pub?

The BBPA's survey of 2023 put the average weekly balance at £103 for an analogue machine and £309 for a digital one. UKHospitality estimated about £8,500 a year net per pub with machines, and Admiral Taverns about £6,000 a year across its estate, as reported in November 2025. Your own meter readings are the real figure.

Who pays Machine Games Duty in a tied pub?

The tenant. HMRC's guidance says that if you're the tenant of a pub you're responsible for Machine Games Duty rather than the premises licence owner, and the machine supplier isn't responsible either. You register before the machine is available to play, file a return every three months and pay within 30 days.

What is the Machine Games Duty rate on a pub fruit machine?

Usually 20%. A category C pub machine has a maximum £1 stake and £100 prize, which falls in HMRC's standard rate band of 21p to £5 to play with prizes of £11 or more. The duty is charged on net takings, meaning money played minus winnings paid out, and those takings are exempt from VAT.

Can my pubco make me use their gaming machine supplier?

Not under any new or renewed agreement since 21 July 2016, if the pubco owns 500 or more tied pubs in England and Wales. Regulation 47 of the Pubs Code bans those pubcos from entering into or renewing a tenancy that requires the tenant to buy or rent gaming machines. Older unrenewed agreements and smaller pub companies aren't covered.