# What Is a Rule 4 Deduction & How Does It Work?

Rule 4 deductions are a fundamental aspect of betting, particularly in horse racing. Although they may initially seem perplexing, understanding how they work can significantly augment your betting knowledge.

This article provides a comprehensive understanding of Rule 4 deductions and their workings in the betting industry.

## What Is a Rule 4 Deduction?

Rule 4 is a regulation applied in horse racing betting when a horse is withdrawn from a race after bets have been placed. This rule adjusts the odds of the remaining horses to reflect the reduced competition, as each horse now has a better chance of winning. The Rule 4 deduction is generally expressed as a certain number of pence in the pound, and it is deducted from the winnings of a bettor.

## How Do Rule 4 Deductions Work?

The objective of Rule 4 deductions is to ensure that the odds reflect the actual probability of a horse winning. When a horse is withdrawn from a race, it improves the odds for the remaining horses. The deductions are calculated based on the odds of the withdrawn horse at the time of withdrawal. The shorter the odds of the withdrawn horse, the higher the Rule 4 deduction.

The deductions are made in pence per pound. For example, if you win £10 and there is a 10p Rule 4 deduction, you will receive £9 as winnings (10p taken from every £1 won). The maximum Rule 4 deduction is 90p in the pound, irrespective of how many horses are withdrawn from the race.

## Where Does The Rule 4 Money Go?

The money deducted due to Rule 4 does not go to any specific party. Instead, it is a reduction in the bettors' winnings to reflect the improved odds due to the withdrawal of a horse. The bookmakers do not benefit from this deduction. Instead, it ensures that the payouts are fair and proportionate to the actual odds of winning

## Rule 4 Deductions FAQs

### Does Rule 4 Apply To Each Way Bets?

Yes, Rule 4 deductions apply to both win and each-way bets. This means that if a horse is withdrawn from a race after you've placed your bet, the potential returns from both the 'win' and 'place' parts of your each-way bet will be subject to the Rule 4 deduction.

### Does Rule 4 Apply To Exchanges?

In betting exchanges, Rule 4 deductions are applied differently compared to traditional bookmakers. The odds are usually not adjusted following a withdrawal. However, if a horse is withdrawn and it was matched at 14/1 or under, the exchange may reduce the winnings of the remaining bets in the market.

### What Is The Maximum Rule 4 Deduction?

The maximum Rule 4 deduction is 90p in the pound. This cap is applied irrespective of the number of horses withdrawn from the race or the odds of the withdrawn horses. It ensures that bettors always retain at least 10% of their original potential winnings.