Do you have to declare your gambling winnings to HMRC? No. You do not need to pay tax on casino winnings in the UK, whether you live in England, Scotland, Wales, or Northern Ireland.
This was not always the case. It’s only been since 2001 that the then chancellor of the exchequer of the UK, Gordon Brown, scrapped the current tax levy on sports and casino gambling winnings.
So why the change? And are there ever situations in which you might be taxed? What if you win a lottery, or in the case of online casinos, a huge jackpot? Surely if you get 2 million in the bank, the UK government will ask for a little of it back? What if I consider myself a professional gambler?
The simple answer is that you do not need to declare or pay Taxes on gambling winnings, full stop. The long answer is that you should always be careful to be able to prove your winnings and be careful how you spend your winnings afterward – as that can be taxable.
Here’s everything you need to know about taxes on casino winnings in the UK.
If you are a UK casino player and win big, you are exempt from paying any of the following taxes:
And while you may be worried when researching that the UK Government has a whole page dedicated to gambling tax submissions, this page isn’t for you. The UK government is making plenty of money on gambling taxes; it’s just taxing the online casinos instead of the punter.
As explained by Forbes far more effectively than us, the logic is still more or less sound: gambling, by definition, is not a money-making scheme. In fact, the RTP of the casino games machines are made so that the house always wins over the long term.
In other words, the winnings of some people are generally offset by the losses of many others.
Microgaming can afford to pay out a £5 million Mega Moolah slots jackpot because it has accumulated twice that in real money bets on the machine – remember, only a small percentage of your bet goes towards the jackpot.
The rest of the money is spread over the casino and the game studios.
If you want to offer gambling services in the UK, and it doesn’t matter if it’s UK slots, poker, or even a lottery, you have to get a Gambling License from the Gambling Commission.
Casinos, poker and betting sites have to pay taxes on their profits. HMRC gets 15% of all revenue from UK players who visit licensed casinos, bingo or gambling sites.
In 2019 alone, the UK Gambling industry was estimated to be worth £14.3 billion, with 30% of that generated by the national lottery and scratch cards – a UK government-run gambling operation.
What we are trying to say is that the UK Government is taking a very healthy slice of tax from Gambling, and you should almost certainly not worry about keeping your slice to yourself.
No. You will not be taxed on casino winning in the UK, whether you bet £10 a week or try to make a living from gambling sites.
We should point out that our advice is very narrowly looking at traditional gambling games such as video slots, blackjack, sports betting, bingo, lotteries, or poker. We cannot offer advice if you do spread betting, financial betting, or trade in the stock market.
Generally speaking, it is almost impossible to be a ‘professional’ gambler at casinos – because, over the long term, you will lose more than you win.
The trick is in knowing when to walk away and enjoy your tax-free UK casino winnings rather than play it back into the gambling sites.
You can get your casino winnings tax-free if you live in the United Kingdom. Currently, that includes the nations of England, Wales, Scotland, and Northern Ireland.
There is no separate rules or regulation regarding gambling taxation in these countries, despite each having its own governing bodies.
Gambling laws are currently held and made by the UK Parliament and, as such, apply to all.
There is no better place to gamble than in the UK. It’s one of the few countries worldwide that does not tax your casino winnings.
But if you suddenly have an extra £10,000, £300,000 or £1 million in your bank account, guess who will come knocking and asking some questions?
HMRC has a habit of popping out of the woodwork when you least expect them, and it’s good to be prepared. In other words, you need to have records of all your big wins – whether that’s screenshots, casino accounts, or deposit and withdrawal amounts.
It’s a good habit to get into anyway. It will help you keep track of your gambling budget and make sure you realise when you need to take a break if you are losing more than you are winning.
Generally speaking, if you’ve won more than 30-40% of your total monthly wage, get some proof of the win.
The win could be years old, and you may have closed the casino account or forgotten even which casino you’ve won. And “I don’t know” is not an acceptable answer on an HMRC form.
If you are lucky enough to win a large sum of money – say a million and a half from the Dream Drop Jackpot slots – your first instinct may be to share your good fortune.
After all, every penny of your gambling winning is tax-free to do as you like, right?
Up to a point. Most of us won’t see those kinds of sums of money, and it may not occur to us that there’s a difference between buying a house for ourselves and buying a house to rent out or even give to family.
As the Tax Scout happily point out; if you are then making money from your winnings, that money is taxable. Example include:
If you are in a happy situation where you’ve won enough gambling to invest and retire, then congratulations! You may not be able to lead a tax-free life, but it’s nothing a good accountant won’t be able to fix.
As long as you keep good records and gamble responsibly, you are lucky to live in a country that knows it’s better to tax those making a profit out of gambling rather than those of us having fun and hoping for a better day than yesterday.
You don’t get much safer, and if you do win, you can know that the casinos need to keep all records of their wins and losses, allowing you to enjoy your tax-free casino winnings with plenty of peace of mind.
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