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1. Do You Have To Pay Tax On Gambling Winnings Uk Property
2. Do You Have To Pay Tax On Gambling Winnings Uk Today

Taxes in the UK. United Kingdom residents can consider themselves lucky, as there are no tax payments for casino winnings. The same rule goes for all casino games, from poker to baccarat, including slot machines. Regardless of the sum they win, players won’t have to report winnings and pay taxes – no matter if it’s £50 or £500,000. Although any winnings gained from gambling be it online, in a high street bookmaker or in a casino, are exempt from tax in the UK, you may be in a situation where some interest earned on those winnings whilst they are in a bank account, savings account, trust fund or bond will be taxable.

Tax: everyone has to pay it and, unlike a certain President of the United States, the fast majority of us don’t have the resources to do the creative accounting required to avoid it. It remains a mystery to many of us, who either see money taken apparently at random from our pay cheques, or disappear as a lump sum at the end of the year.

One of the most mysterious things related to tax is how it relates to gambling – are you required to pay tax on your winnings from gambling? Is it sometimes better to win less so you pay more? If you do have to pay tax, at which point do you count it; after every win, when you leave a casinos, or cumulatively over a year?

Luckily for you, your good friends over here at MobileSlots4U happen to know a thing or two about how gambling taxes work and we’re here to share that knowledge with you. So strap in, and enjoy our quick guide to how much you can expect to spend on taxes when you gamble.

No Tax On Gambling In The UK

Let’s get straight to business with the best of the good news. If you gambling in the UK – in whatever form that might take – you’re not going to pay even a single penny in taxes to the government. Realising that the risks associated with gambling don’t make it anything close to resembling a reliable income, the HMRC has decided that all winnings earned from sports betting, online casinos, poker games, bingo or lotteries are exempt from taxation.

Yup, you read that right: that includes online and mobile casinos. This even counts for online and mobile casinos which are based overseas – while the operators themselves may have to pay the Place of Consumption Tax on their revenues from UK players if they’re based abroad, the players don’t need to pay a penny!

It hasn’t always been this way and historically there have been a number of different taxes levied against taxes through the history of UK gambling. Yet, since 2001, UK betting duty has been abolished, clearing the way for tax free gambling. Every pound and penny you make through any form of gambling in the UK stays in your pocket.

Gambling Taxation Elsewhere in the World

Most other countries in the world are as enlightened as the UK when it comes to gambling taxation, with a few surprising and notable exceptions. Even within the EU, gambling taxation is still an issue handled by individual member states, which is why you end up with situations where countries like France will tax people 2% on poker wins and 7.5% on sports and horse racing, Greece will tax 10% on all lottery wins and Holland will tax a hefty 29% on lottery wins over €454.

The EU country set to make the most from gambling tax is Slovenia, where a lottery win over €4000 is going to set you back a staggering 50% of your winnings! Outside the EU you’ll find pockets of gambling taxation – like Nigeria’s flat rate of 20% on all winnings and South Africa’s 6% on horse races, but you’ll find generally that no tax applies, and will only apply if you’re playing in those countries, not just at online or mobile casinos based there.

All countries and governments have their own online gambling tax policies and legislation so we need to look at this question from a global perspective. Firstly we’ll cover the situation in the UK and following that look at how things may differ in the rest of the world.

Do you have to pay tax on your gambling winnings?

UK Gambling Taxes

Key Points

• All winnings either online or offline are tax free!
• Any betting tax abolished in 2001 by Gordon Brown.
• Tax used to be on bookies but they passed to punters.
• Bookmakers must now pay 15% POI tax but not punters.
• POI tax on any games of chance increased from 15% to 21% but again not for punters.

In the UK any and all winnings from gambling – either online or at betting shops – are entirely tax free and do not need to be declared as part of any tax return.

This has been the case since the then Chancellor of the Exchequer Gordon Brown’s budget of 2001, when he abolished Betting Duty which had stood at 6.75%. That duty was removed in an attempt to persuade bookmakers not to move their operations overseas and therefore take jobs and revenue away from the UK economy.

All of that is not to say that there is no tax involved when it comes to gambling in the UK, however, and there is a ‘point of consumption’ tax related to the activity. This does not affect punters themselves, though, and will be dealt with separately further down this page.

Will the situation ever change? Generally speaking there is little chance that this situation will be reversed, either, as the UK tax system is simply not built in such a way that taxing gambling winnings would be viable. This is the case as it is fairly standard within the system that if tax is levied on the income or profit made through an activity, then there must also be an allowance made against losses through the same activity.

With gambling being an activity where overall more losses are made by punters than winnings, therefore, such a change in the tax legislation would cost the UK government revenue. As a result, it is quite simply not something which would be considered. Your betting, casino, slot machine, poker and bingo winnings are yours to keep tax free.

What About Professional Gamblers?

It may seem logical that the tax situation would be different for professional gamblers than it is for occasional punters. When it comes to pure winnings from betting, however, that quite simply is not the case. As we have discussed above these winnings are not taxable and this remains true even for a ‘professional gambler’. That is because HMRC do not recognise professional gambling as a taxable trade.

In fact, within their most up to date ‘Business Income Manual’, HMRC clearly define their position on professional gambling:

‘The fact that a taxpayer has a system by which they place their bets, or that they are sufficiently successful to earn a living by gambling does not make their activities a trade.’ BIM22017

Gambling winnings, therefore, remain free of tax regardless of whether they make up an individual’s main source of income. Where the situation can get a little more complicated, however, is in the case of income related to gambling but not actually direct winnings from gambling. Appearance fees paid to poker players for playing at certain tournaments, for instance, represent payment for a service provided to the tournament organisers and as such may be taxable.

Away from the UK, too, tax laws and legislation do differ and it would benefit a professional gambler outside of the UK to research the specific rules and regulations within their own country.

UK Point of Consumption Tax

As we mentioned earlier, Betting Duty for gamblers was abolished in 2001 and was at that time replaced by a 15% tax on gross profits for bookmakers and gambling providers. That tax was initially charged on a ‘point of supply’ basis, meaning that if the bookmaker or company were not based in the UK, then they were not liable. This situation has more recently changed, however.

From the latter part of 2014, the tax on bookmakers’ profits was changed to a ‘point of consumption’ tax by a combination of the Gambling (Licensing and Advertising) Act 2014 and by the introduction of ‘Remote Gaming Duty’. This means that regardless of where they themselves are based, providers must pay a 15% duty on any bets placed by UK customers.

In the 2018 budget chancellor George Osborne announced that the point of consumption tax would rise from 15% up to 21% for all games of chance but sports betting would remain at 15%, for now.

Gambling Taxes In The Rest Of The World

Do You Have To Pay Tax On Gambling Winnings Uk Property

Do You Have To Pay Tax On Gambling Winnings Uk Today

As the above table shows, where various types of gambling are legal there are a variety of different attitudes towards taxation on winnings from those forms of betting. If your country is not listed then it’s likely gambling is not strictly legal and there is therefore no taxation laws.