Do casino winnings have to be taxed?

Who makes his bets in the online casino, which would like to bring in the best case also a nice profit. Some see this as a bonus for fun, others would like to collect their winnings on a regular basis and still others are aiming for the big jackpot. In any case, the question arises as to what actually happens to the money that the customer wins.

And above all: How does the state view winnings in the casino? Are taxes due on them and are there any tips and tricks? You can find all the answers here.

What you need to know about "Do casino winnings have to be taxed"?

  1. Casino winnings are tax free in Australia
  2. When do taxes start to accrue?
  3. Taxes on interest winnings
  4. Keep receipts for tax office

1.) Casino winnings are tax free in Australia

The good and clear news first:
Winnings made in Australia in casinos, whether online casino or on-site, are tax-free. No taxes have to be paid on casino winnings.

This is not only true for casinos, but also for Lotto, which is played by a lot of people. There is no casino tax, nor does this income fall under income tax.

The reasoning is in the nature of things, as income from gambling is classified as irregular and therefore does not count as income. However, there may be exceptions to this if, for example, you enter the scene as a professional gambler (see next paragraph).

The tax exemption applies to all winnings made in Australia or EU. In this regard, it is important to note that the casino must also have a Australian license or a license in the EU. If you make high winnings in the Caribbean and come to Australia with it, customs will want to have their share of it. So you should pay attention to which online casino you play at and which licenses it has.

It is also clear to say that the casino tax exemption applies regardless of the size of the winnings. Whether it is a small euro amount or the big jackpot – no taxes are due on the winnings.

Accordingly, such winnings do not have to be listed in the income tax return.

2.) When do taxes start to accrue?

Even though it is generally true that no taxes are due on casino winnings, there are still things that need to be taken into account. The legal dividing line between taxes and tax exemption is drawn at the professionalism with which a player appears. And thus roulette and poker can also lead to taxes.

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According to the law, professional gamblers who earn their living from these games generate regular income, which is then subject to income tax at the end of the year.

The luck factor in games of chance therefore turns out to be an advantage in the tax question. This applies to slot machines, horse betting, lotto, roulette and also poker. If you merely gamble from time to time and do not depend on regular winnings to earn a living, the tax exemption is definitely there.

3.) Taxes on interest gains

Taxes can also be incurred on invested winnings, which means that casino winnings can also be passively taxed.

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Anyone who invests their winnings, for example from a jackpot, must also pay tax on the corresponding interest from the second year onwards. This is something that must be taken into account in any case, which is particularly important in the case of very large winnings.

4.) Keep receipts for the tax office

So, as a rule, you do not need to pay attention to what happens to your winnings. If you have been lucky enough, the winnings from the online casino will be transferred to your bank account and you don't even have to declare it in your tax return. Nevertheless, you'd better keep the receipts for these winnings.

The reason is that the tax office can, of course, ask where a certain amount of money came from in case of doubt. In such a case, you are covered and save yourself unnecessary effort if you can prove the profits regularly. Especially in this context, however, it is then also important that you have chosen a provider with a license from Australia or the EU.

Summary of casino winnings and taxes

In summary, it can be said first of all that gambling and casino winnings are tax-free in Australia. It does not matter how high the actual winnings turn out to be. Whether it is a few euros or a big jackpot win, there are no taxes for it. It should be noted that with Casinos with Australian or EU license is played.

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According to the tax exemption, these amounts do not have to be declared in the tax return. Nevertheless, receipts should be kept to be able to explain the increase in the account on demand.

Taxes can be incurred in two ways. Firstly, if you act as a professional player, which is especially true for poker. Then the irregular income becomes regular income, which must be declared normally in the income tax return. On the other hand, taxes can be incurred if a profit from the casino is invested and you receive interest on it. In this case, the interest would be income that is taxable.

If the last two exceptions do not apply, you can therefore benefit from the tax exemption on casino winnings.

Author: Jake ErvingRated: Do casino winnings have to be taxed?Author Rating: ⭐⭐⭐⭐ 90%