Gambling winnings could jeopardise your benefit payments as they're counted towards capital, which might lead to a reduction or cessation of your benefits. The Department for Work and Pensions (DWP) clarifies that while gambling winnings aren't considered earnings, they do contribute to your capital.

If you're lucky enough to win and your total savings exceed £6,000, you could find your Universal Credit slashed or halted, BirminghamLive has reported. A spokesperson for the DWP explained: "Winnings obtained from gambling activity do not meet the definition of earnings within Universal Credit Regulation 52 and are not taken into account as an unearned income. Any profit made from gambling activity will only be considered within Universal Credit as part of a person's capital.

"It is the customer's responsibility to advise DWP of a change in their circumstances that would affect their benefit and for means-tested benefits, this includes receiving gambling winnings which increase the total capital held and impact their award."

Moreover, HMRC could take a chunk of your winnings as interest on them is taxable. They deduct tax and share data with the DWP to combat fraud.

The Department for Work and Pensions (DWP) has the authority to scrutinise bank transactions, including those related to online betting websites. Matched betting, a practice where individuals utilise free bets from bookmakers to secure a profit, could be considered as capital by the DWP.

However, there have been instances where regular amounts have been classified as monthly income, subsequently reducing benefit payments. The DWP may also request statements from other platforms such as PayPal, where money can be held.

Your credit record will list your online gambling accounts, as each website typically conducts a credit check when you open an account to confirm your personal details. This means that during claim reviews, the DWP will be aware of all your accounts.

A capital limit of £16,000 applies if you claim Universal Credit, income-based Jobseeker's Allowance, income-related Employment and Support Allowance (ESA), Income Support, and Housing Benefit (if you are under State Pension age). If your capital exceeds this amount, your entitlement to benefits ceases and your payments are halted.

Any funds between £6,000 and £16,000 are treated as if they provide a monthly income of £4.35 for each £250, or part of £250. For instance, if you have £6,300, the first £6,000 will be disregarded and the remaining £300 will be considered as providing a monthly income of £8.70.

This amount is then deducted from your monthly Universal Credit payment. Those on income-based JSA, income-related ESA, Income Support and Housing Benefit lose £1 per week for every £250, or part of £250, that's over £6,000.

For people who get Pension Credit, there is a capital limit of £10,00 before deductions are applied. Every £500 over £10,000 counts as £1 income a week. But unlike the other benefits above, there is no upper limit on the savings you can have.

For support dealing with gambling problems, you can visit online resources such as Gamcare, Gambling Therapy, Gamban and GambleAware.