When playing online, there are few things that you need to know about gambling taxes. There are more than 80% of Australian adults that gamble, but how much do they know about taxes placed on gambling.
In most countries, gambling is viewed as a form of income and is therefore taxed. This makes sense as some people consider themselves as professional gamblers. However, if you don’t consider yourself a pro player, what are the chances you will pay tax, and how much tax will you be paying. We answer all those questions in our guide below.
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Gambling Taxes Australia Page Content
- Tax On Gambling Winnings
- Online Gambling Taxes
- Claiming Gambling Losses
- FAQs About Gambling Taxes In Australia
No, you will not pay tax on gambling winnings in Australia. Gambling is not considered an income. Therefore, it is not taxed. In legal terms, when you place a bet well in Australia, it is not considered a profession. Whether you’re playing at a land-based casino site or an online casino, all your winnings will be yours.
The Australian government considers gambling as a form of entertainment and leisure. They do not charge tax on this recreational activity. The government is an agreement that all winnings made from gambling activities is a result of good luck. It is explained as if someone wins big, and there is also a chance that they could lose a lot of money in another gambling session.
However, if you are a professional gambler, you will be subjected to paying tax on all your gambling winnings. With professional players, it is argued that their winnings are made from skills rather than luck. Professional players are considered a business, as some will receive endorsements, sponsorships, and other gains for their careers.
You may be wondering then who pays the taxes on gambling. Well, casino operators are the ones who pay taxes rather than the players. They also pay fees during the development of their operations. This is above them having to obtain a license to offer their services.
The taxes will differ depending on where they are operating and what type of gambling they are offering. Operators pay taxes on things such as player lost turnover and their net profit.
Australian players will be happy to know that they will also not be paying taxes for gambling online. The Interactive Gambling Act of 2001 is the one that governs the laws and rules of online gambling in Australia. The act states that it’s is not legal to offer real money online interactive gambling to Australian residents. This means you can not run a gambling operation open to AU players from within the Australian borders.
However, this has not stopped players from visiting offshore casino sites to place bets. $800 million was spent on online gambling by 2010 in Australia. It is not a criminal offence to play at offshore casinos in Australia. Companies that are based in Australia can also offer these services to gamblers outside of Australia.
Australian players will often face a transaction fee when making deposits or withdrawals at online gambling websites. Again, these fees are dependent on the banking method that you use. For example, the payment methods such as Skrill or Neteller will not charge any fee. However, if you were using Visa or MasterCard, there is a foreign transaction fee. Other fees that you may incur include currency conversions as some casino sites online. This is because not all casinos offer players the opportunity to play using AustralianDollar.
Online Sports Gambling Taxes
With online sports gambling, punters will not need to pay a tax as well. The only people that will be paying tax are gambling operators such as sportsbooks. So, if you enjoy placing bets on the Melbourne Cup, you don’t have to worry about the Australian taxation officer coming for your winnings. ATO considers all money made from gambling age activities such as betting on sports, not income.
However, all wins made from layoffs or bet-backs are considered taxable gambling sales. Similarly, if you are own a gambling business or some betting business, you will also pay tax. The ATO considers you as a professional gambler when you have business connections within the gambling industry.
In terms of gambling losses, you will not be able to claim deductions for the bets you lost. If you have any losses while placing a bet on race, poker table, or the lottery, it doesn’t matter how much money you have lost. The ATO will not allow you to claim those deductions as gambling winnings are not taxable.
Of course, this is different if you own a gambling business or pro gambler. For instance, if you own a horse racing business, you’ll be able to enjoy tax deductions such as Goods And Services tax or even the Capital Gains Tax.
You can win any amount at casinos and still not pay tax in Australia. In fact, there is no set amount that you have to win before paying tax.
No, gambling is not taxable in AU. All winning made from gambling activities are not considered an income; therefore, they won’t get taxed.
This will depend on how much your gambling income is. If you are making 18001 and more, you could play 54,232 AUD plus 45% excess over $180,000.
The Australian government does not consider gambling a job. Therefore, any money made from recreational activity was made from pure luck and not skill.
No, gambling is not classed as an income for ordinary lottery, roulette, blackjack or poker players. The moment you classify gambling as your business, then you will have to pay tax.
Yes, you can buy a house, go on holiday or buy a new car. What you do with your gambling winnings is completely up to you.
No, you will not have to claim for online gambling winnings. While you may incur costs and fees when gambling online, tax is not of them.
Yes, professional gamblers have to pay tax. They can also claim deductions from their losses.
Keeping an accurate record of your gambling winnings and losses will help you prove your losses. You have to provide statements, receipts, tickets or any other records that show you have won and lost.
Taxes from online sporting activities go to the Australian Taxation Office. The money collected is used to contribute to the economic and social well-being of Australians.