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“In this world, nothing is certain except death and taxes,” said the founding father of the U.S., Benjamin Franklin. The wise word is also useful in the field of online gambling, so let's read the article to know about the online gambling taxes all over the world!
To be honest, it's all about your location. If you are an online gambling player in England, some part of European counties, Oceania and Canada, the answer is no, you don't need to pay the tax for the money you win from online gambling. However, some countries do ask to declare part of the prizes as tax, like America, the most important thing is, different jurisdictions have different rules.
Do I need to pay the tax for the money I win from gambling in different countries？
No, in England. Good news for England gambler is that they don't need to pay the tax for the money you win from gambling. Gaming Act was abolished Since 2001, which means winnings from sports betting, online casinos, pokers, bingo, lottery is duty-free. Republic of Ireland applies the same rules as the United Kingdom. In England, winnings from gambling, is neither considered as income, nor capital gains, it's a“receipt of good luck”. In Canada, it's different from income tax, the winnings doesn't seem to be taxable income, at least for now, winnings in Canada has no tax. Australians and New Zealanders don't need to pay for the income tax from gambling, because gambling is considered as a hobby or an entertainment not a profession. Even Oceanian professional gamblers can use the loophole to make money!
Do you need to pay the tax for your winnings in different countries?
The chart shows the different tax ratios from different countries:
As you can see on the chart, there is no hard and fast rules for income tax on gambling. Some European countries have no tax, some have very strict law for it, if you are in a country that is not listed above, it's worth time to do some research. Countries like England, Canada, Germany, Austria, Belgium, Bulgaria, Australia, Denmark, Italy, Sweden, Malta., don't have tax for online gambling, other countries such as India, there are different laws in different states.
The same rules work on professional gamblers, and players bet £1 on race on Saturday. In England, no matter how much you bet, the winnings has no tax. Professional gamblers will be constrained by laws of specific jurisdictions, English poker gamers go to Les Vegas will be constrained by the law of their country, 30% of the prizes will be detained.
The Gambling Act 2005 says, the online gambling sites need to pay for 15% tax no matter where they are. Casinos, pokers and bingo have the same tax with the online gambling sites, under the law of the jurisdiction, any activities that considered as gambling-related need to pay for the same tax ratio, including gambling in casinos or online, bingo and poker.
History of online gambling in England
The first decade of this century, many online gambling sites and gambling companies had a trend transferring the business to overseas tax heaven.
The prime minister at the time, Gordon Brown, amend the law, to make sure the business owners still pay for the tax.In 2001, the rule that requires bettors pay the tax for their prize was repealed, now the government of the United Kingdom ask the bookmaker companies and platforms(not necessary founded in England) 15% of gross profit as tax, Gaming Act amended in 2005 branching out into online gambling for the first time, what is Gambling Licensing and Advertising Bill passed in 2014? The correction of Convention makes the law become a legal requirement, all the operators that want to run in domestic (UK), no matter where they are, need to have a certain UK gambling license, not just a permission issued by a single jurisdiction.
The change of the bill is based on geographical tax law. Since 2014, the law of point of purchase was corrected and be replaced by point of procure, which means the bookmaker companies outside UK still need to impose 15% tax from the bet of UK gamblers. Operators need to pay for betting tax to fit the laws. According to the nature of the business, there are three kinds of different duties need to be paid, General Betting Duty (GBD), Pool Betting Duty (PBD) and Remote Gaming Duty (RGD). High-end bookmakers and spread betting will be conducted here.
Unfortunately, how will Brexit affect industries is unclear, however, a general agreement is that online gambling will be affected lesser than other business. There are two reasons of that, first, all kind of gambling is decay-resistance, no matter how financial situation may be, gambling industry is on the top of it. Secondly, since Public Procurement Laws have become effective, many big bookmakers ' companies of UK were founded in Europe or outside of Europe, so the tax will remain the same.The problem is that Gibraltar as a territory of the United Kingdom, is the base of many bookmakers ' companies, so it may affect employment there.
Why many online gambling sites founded their bases in Gibraltar? The answer is money, it's a usual thing in business. The taxation in Gibraltar is only 1%, and the best part of it is, the maximum of the tax is £425,000. Many network operators pay the tax way much lesser than they should, as England market is still leading online gambling industry, sale tax provide a level playing field for the company's owners founded in tax heaven and coastline of Great Britain.
English gamblers can thank for Gordon Brown, because they don't need to pay for their winnings, Gordon is the one who change the rules of regulatory rules of gambling industry, expand the casinos, relax the advertising bill and deduct the betting tax for the gamblers, which truly resonate with decision makers. In 2002, Mr. Brown made his thought into a policy, tax the bookmakers 6.75% instead of tax the gamblers 9%, it's the first time the gambler can bet 100% in the forty years.
The first decade of this century, the burst of technological innovation, faster internet speed, reliable notebooks, lower price, fasten the development of innovation. One of them is online gambling, and the government decide to intervene and strengthen the regulatory framework.
As Gambling Act was enacted, online bookmakers get more serious supervision, they had to report the Gambling Commission to run, the key point is the decision makers didn't make a big turn on the tax issue like the most people worried about, so the gamblers can bet freely and don't need to be worried about their winnings will be taken.
No tax is good news for gamblers, but how does it affect the online bookmakers? William Hill said the fist half year the profit of the companies ' profit decreased about £20 million, tax more than £40 million, which is £40 million more than past year, but there is big difference in cost estimating of POC.
The other changes in the industry are strategical, Ladbrokes works with GalaCoral, works between PaddyPower and Betfair make a betting tycoon, these works between these companies want to minimize the loss of and appears M&A culture. Overall, the income of betting platforms in UK will be rising, which indicates any procure will be negated.
To be honest, it's all about your location. If you are an online gambling player in England, some part of European counties, Oceania and Canada, the answer is no, you don't need to pay the tax for the money you win from online gambling. However, some countries do ask to declare part of the prizes as tax, like America, the most important thing is, different jurisdictions have different rules.
Do I need to pay the tax for the money I win from gambling in different countries？
No, in England. Good news for England gambler is that they don't need to pay the tax for the money you win from gambling. Gaming Act was abolished Since 2001, which means winnings from sports betting, online casinos, pokers, bingo, lottery is duty-free. Republic of Ireland applies the same rules as the United Kingdom. In England, winnings from gambling, is neither considered as income, nor capital gains, it's a“receipt of good luck”. In Canada, it's different from income tax, the winnings doesn't seem to be taxable income, at least for now, winnings in Canada has no tax. Australians and New Zealanders don't need to pay for the income tax from gambling, because gambling is considered as a hobby or an entertainment not a profession. Even Oceanian professional gamblers can use the loophole to make money!
Do you need to pay the tax for your winnings in different countries?
The chart shows the different tax ratios from different countries:
| Country | Rules/Tax Ratio | Games |
| Greece | 10% | Lottery |
| Latvia | 25% | All |
| Netherlands | Winning more than €454 / 29% | All |
| France | 2% | Poker |
| 7.5% | Sports/Race | |
| Portugal | 35% | Lottery |
| Slovenia | Lottery more than €4000/ 50% | Lottery |
| South Africa | 6% | Race |
| Nigeria | 20% | All |
The same rules work on professional gamblers, and players bet £1 on race on Saturday. In England, no matter how much you bet, the winnings has no tax. Professional gamblers will be constrained by laws of specific jurisdictions, English poker gamers go to Les Vegas will be constrained by the law of their country, 30% of the prizes will be detained.
The Gambling Act 2005 says, the online gambling sites need to pay for 15% tax no matter where they are. Casinos, pokers and bingo have the same tax with the online gambling sites, under the law of the jurisdiction, any activities that considered as gambling-related need to pay for the same tax ratio, including gambling in casinos or online, bingo and poker.
History of online gambling in England
The first decade of this century, many online gambling sites and gambling companies had a trend transferring the business to overseas tax heaven.
The prime minister at the time, Gordon Brown, amend the law, to make sure the business owners still pay for the tax.In 2001, the rule that requires bettors pay the tax for their prize was repealed, now the government of the United Kingdom ask the bookmaker companies and platforms(not necessary founded in England) 15% of gross profit as tax, Gaming Act amended in 2005 branching out into online gambling for the first time, what is Gambling Licensing and Advertising Bill passed in 2014? The correction of Convention makes the law become a legal requirement, all the operators that want to run in domestic (UK), no matter where they are, need to have a certain UK gambling license, not just a permission issued by a single jurisdiction.
The change of the bill is based on geographical tax law. Since 2014, the law of point of purchase was corrected and be replaced by point of procure, which means the bookmaker companies outside UK still need to impose 15% tax from the bet of UK gamblers. Operators need to pay for betting tax to fit the laws. According to the nature of the business, there are three kinds of different duties need to be paid, General Betting Duty (GBD), Pool Betting Duty (PBD) and Remote Gaming Duty (RGD). High-end bookmakers and spread betting will be conducted here.
Unfortunately, how will Brexit affect industries is unclear, however, a general agreement is that online gambling will be affected lesser than other business. There are two reasons of that, first, all kind of gambling is decay-resistance, no matter how financial situation may be, gambling industry is on the top of it. Secondly, since Public Procurement Laws have become effective, many big bookmakers ' companies of UK were founded in Europe or outside of Europe, so the tax will remain the same.The problem is that Gibraltar as a territory of the United Kingdom, is the base of many bookmakers ' companies, so it may affect employment there.
Why many online gambling sites founded their bases in Gibraltar? The answer is money, it's a usual thing in business. The taxation in Gibraltar is only 1%, and the best part of it is, the maximum of the tax is £425,000. Many network operators pay the tax way much lesser than they should, as England market is still leading online gambling industry, sale tax provide a level playing field for the company's owners founded in tax heaven and coastline of Great Britain.
English gamblers can thank for Gordon Brown, because they don't need to pay for their winnings, Gordon is the one who change the rules of regulatory rules of gambling industry, expand the casinos, relax the advertising bill and deduct the betting tax for the gamblers, which truly resonate with decision makers. In 2002, Mr. Brown made his thought into a policy, tax the bookmakers 6.75% instead of tax the gamblers 9%, it's the first time the gambler can bet 100% in the forty years.
The first decade of this century, the burst of technological innovation, faster internet speed, reliable notebooks, lower price, fasten the development of innovation. One of them is online gambling, and the government decide to intervene and strengthen the regulatory framework.
As Gambling Act was enacted, online bookmakers get more serious supervision, they had to report the Gambling Commission to run, the key point is the decision makers didn't make a big turn on the tax issue like the most people worried about, so the gamblers can bet freely and don't need to be worried about their winnings will be taken.
No tax is good news for gamblers, but how does it affect the online bookmakers? William Hill said the fist half year the profit of the companies ' profit decreased about £20 million, tax more than £40 million, which is £40 million more than past year, but there is big difference in cost estimating of POC.
The other changes in the industry are strategical, Ladbrokes works with GalaCoral, works between PaddyPower and Betfair make a betting tycoon, these works between these companies want to minimize the loss of and appears M&A culture. Overall, the income of betting platforms in UK will be rising, which indicates any procure will be negated.
