What are Rule 4 Deductions

Rule 4 is a mechanism through which deductions are made to horse racing bets when a runner withdraws from a race. This rule is often not known or misunderstood by casual punters. Subsequently, it can cause a certain amount of shock when deductions are made to someone’s returns without any further explanation.

Why Bookies Use the Rule 4 Deductions

Rule 4 deductions are made to account for the change in the dynamics of a race. The case of horse racing non-runners, after the line-up has been announced, affects the remaining participants’ chances of winnings.

For example, if there were six runners in a race and one pulled out, the remaining ones would only have to beat four competitors rather than five. Because of the physical changes to the race, the odds of those remaining need to be adjusted accordingly. For those that place a bet after a withdrawal, the advertised odds will reflect the new dynamics.

However, if you’ve already made a bet and locked in the odds, the changes won’t be reflected in the price you received. Therefore, bookmakers have to make deductions after the race is over and before the payout is processed. These are Rule 4 deductions.

Rule 4 Deductions Calculator

Even though Rule 4 is one of the most straightforward horse racing betting terms, many people are wondering how the deductions are made. We know that a change of dynamics can initiate Rule 4, but how do bookmakers calculate the amount to deduct from a bet?

Rule 4 deductions are calculated by looking at the odds of the horse that’s been withdrawn. It’s important to note that the deductions apply only to the win portion of your bet. In other words, only money from your profit is deducted, not from your stake.

In general, Rule 4 deductions are expressed as percentages. However, you can put these into financial terms by thinking about the rate of €1. For example, a 20% reduction means you’ll lose €0.20 for every €1 you bet. From here, a calculator is used to generate a percentage based on the odds of the horse that’s been withdrawn (see table below).

Rule 4 Deductions Table

Rule 4 for Betting Exchanges 

In exchange betting, horse racing Rule 4 deductions still apply but in a slightly different way. At platforms such as Betfair, a “reduction factor” is used to calculate how much to deduct from your profit. This factor is based on a horse’s chances of winning the race.

For example, if a reduction factor of 25% was set, then the traded price on all previously matched bets would be reduced by 25%. So, if you placed a €10 bet on a horse with a traded price of 8.0, your potential profit would be €70. However, if a 25% reduction factor is in action, you’d receive 75% of €70, which is €52.50. This means the revised traded price of your pick would be 6.25.

What Happens with Antepost Bets?

A lot of horse punters elect to place their wagers months before a race takes place. Even though there is a high risk of your horse not participating in an event, you will gain significant advantages from backing it before the market settles.

One of them is that you will probably get higher odds compared to when we are closing into the event. The other is that the Rule 4 deductions do not apply to ante post horse racing betting. Bookmakers believe that the risk of backing a runner before the field is set covers the fact that a horse will pull out minutes before a race. 

How the Best Online Bookmakers Apply Rule 4

When a bookmaker sets a price, they do it on the basis that all planned runners will take part. Therefore, when a horse is withdrawn, it’s only fair that the odds change to reflect that.  Let’s take a look at some of the best in the business and how they do it.

Bet365 Rule 4

Bet365 Rule 4 deductions are some of the best in the business. In order to give you more, there are no 5p deductions, meaning that the first horse withdrawn with odds of between 10/1 and 14/1 won’t affect your returns. As you’d expect, Rule 4 deductions apply to win and place bets.

William Hill Rule 4

Rule 4 William Hill standards are better than most. Like its peers, the first 5p deduction doesn't count. In other words, if the total Rule 4 deduction is €0.05, William Hill won’t take any money from your winnings. Additionally, total Rule 4 reductions won’t exceed €0.90, regardless of how many horses are withdrawn.

Unibet Rule 4

Unibet Rule 4 deductions are fairly standard. However, this operator also has something known as Tattersalls Rule 4. Under these rules, deductions on win bets are capped at 75% (non-runners odds were 1.30). Deductions on place bets are capped at 55% (non-runners odds were 1.06 or shorter).

Coral Rule 4

Coral Rule 4 deductions follow industry standards both in terms of reductions and what happens when multiple horses are withdrawn. Basically, the deductions can range from nothing to 90%. Additionally, if multiple horses are withdrawn, the price can be adjusted multiple times.

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