Professional Gambler & Income Tax


M

Mazy

unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
 
Ad

Advertisements

D

Doug Ramage

Mazy said:
unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
Probably true. The main reason being that if the winnings were taxable, then
the IR would have to allow tax relief for the losses. And since most
gamblers lose, AFAIK, so would the IR.
 
S

Steve Jones

Mazy said:
unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
I was told that the same applies to proceeds from Futures Trading, if
undertaken by an individual.

I'm not really convinced, as it could just be a myth, or wishful thinking on
the part of a certain trader I know.
 
R

Richard Wilcox

Steve Jones said:
I was told that the same applies to proceeds from Futures Trading, if
undertaken by an individual.

I'm not really convinced, as it could just be a myth, or wishful thinking on
the part of a certain trader I know.

Wins from legal gambling is not subject to further taxation. There is
a betting tax and in the case of Licenced Betting Offices in the
manner they suggested to the Government, they deduct (Is it 8% or some
other figure these days?)from winnings only. However for every £1 that
walks into a betting shop and stays there will result in a £5
turnover. So from that £1 and assuming 8% deductions there is an
effective rate of tax out of that £1 in the 32% plus range.

On-course, where the real professional gamblers go, betting is at a
lower rate (4%?).

This is also why there are now betting firms, IG Index etc., where you
can have spread betting on the Stock Exchange, futures etc etc - less
tax, less duties, less administrative charges etc etc.

Richard
 
J

Jonathan Bryce

Richard said:
Wins from legal gambling is not subject to further taxation. There is
a betting tax and in the case of Licenced Betting Offices in the
manner they suggested to the Government, they deduct (Is it 8% or some
other figure these days?)from winnings only. However for every £1 that
walks into a betting shop and stays there will result in a £5
turnover. So from that £1 and assuming 8% deductions there is an
effective rate of tax out of that £1 in the 32% plus range.
Betting duty was abolished a couple of years back.
 
R

Ronald Raygun

Jonathan said:
Betting duty was abolished a couple of years back.
But not outright. I gather it was replaced by a levy on
bookies' profits.
 
M

Mazy

unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
If wonder if the same would apply in Southern Ireland, or other
european countries?

I would expect most tax authorities in other EU countries would also
prefer not to charge income tax as an allowance would have to be given
on losses.
 
R

Richard Wilcox

Ronald Raygun said:
But not outright. I gather it was replaced by a levy on
bookies' profits.

Since 6th October 2001. I am duly corrected.

Richard
 
R

Ron Clarey

There was a similar situation that appeared a few years ago on TV about
an American gambler who was trying something similar in the USA, I work
next door to a tax office so I asked some of the staff what their
opinion was. They replied that if the gambler could show receipts for
winnings and losses it is possible that they might allow it BUT it would
be VERY VERY unlikely how many gamblers do you know that keep receipts
for everything.

Mind you if Bill Werbeniuk ( a snooker player from way back) can get tax
relief for drinking why not?
 
Ad

Advertisements

M

Mazy

unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
I *think* we are of the general consensus that no income tax would be
owed by a professional gambler in the UK. By "pro-gambler" I don't
mean bookmakers or those offering tipping services etc..

Though it would probably be a good idea for a pro-gambler to keep any
evidence to show where their income came from (such as bookmaker
receipts), in case they were asked to provide proof of where their
income came from.

Is there any chance a pro-gambler would be taxed under schedule D ?
I'm not even entirely sure what this is, I just remember reading an
article once, though maybe I picked it up completely wrong...

Anyone know?
 
R

Ron Clarey

When you said "if the gambler could show receipts for winnings and
losses it is possible", may I ask what you mean? What is possible?
No income tax is owed, or their losses would be considered as being
tax deductible?
The gist of the program was the gambler was trying to claim that his
only source of income was from gambling and he did not have a job or
another source of money. The tax man was not convinced and was asking
the gambler to prove how much money was coming in and going out. Some
casinos issue receipts apparently. I think the gambler was trying to
offset his losses against winnings in order to pay less tax. Even though
winnings from gambling may not be taxed, if it is your only source of
income you would still have to declare it against your tax bill.

I didn't take to much notice of the fine print I just enjoyed watching
the program.
 
J

Jon Griffey

Mazy said:
unfortunately this is just hypothetical, and does not apply to me!

If someone was a professional gambler i.e. they made a *living* from
betting on horse races, and the profits they made from simply betting
on horses was their only income; would this "profit" be liable for
income tax (or any other tax?)

afaik, all betting wins (from horse racing anyhow) in the uk are not
liable for any income tax (not matter how large - I think).
A client of mine made a living being a professional gambler. In fact
more specifically he ran a tips service where by giving tips to punters
he took a share of their winnings.

I managed to persuade the local Inspector of Taxes that this should be
exempt from income tax.

Unfortunately this also meant that the client no longer required an
accountant!
--
Jon Griffey FCCA ATII
Hackett Griffey
Chartered Certified Accountants & Registered Auditors
2 Mill Road, Haverhill, Suffolk, CB9 8BD

Tel (01440) 762024

www.griffey.demon.co.uk

See website for disclaimers
 
M

Mazy

A client of mine made a living being a professional gambler. In fact
more specifically he ran a tips service where by giving tips to punters
he took a share of their winnings.

I managed to persuade the local Inspector of Taxes that this should be
exempt from income tax.

Unfortunately this also meant that the client no longer required an
accountant!
--
Jon Griffey FCCA ATII
Hackett Griffey
Chartered Certified Accountants & Registered Auditors
2 Mill Road, Haverhill, Suffolk, CB9 8BD

Tel (01440) 762024

www.griffey.demon.co.uk

See website for disclaimers
Hi Jon - one of the perils of being an extremely effective accountant!

After the local Inspector of Taxes decision, was your client under no
obligation to state on a self-assessment return that they made/won "x"
amount from their betting; even if it's not taxable?

I suppose the amount they would be winning each year would also have
been a fair bit, not just a thousand or two.
 
J

Jonathan Bryce

Mazy said:
After the local Inspector of Taxes decision, was your client under no
obligation to state on a self-assessment return that they made/won "x"
amount from their betting; even if it's not taxable?
No. Just like you don't need to mention interest received on an ISA and so
on.
 
J

Jon Griffey

Hi Jon - one of the perils of being an extremely effective accountant!

After the local Inspector of Taxes decision, was your client under no
obligation to state on a self-assessment return that they made/won "x"
amount from their betting; even if it's not taxable?
The Inland Revenue is only interested in taxable income so it no longer
needed to be reported, hence why the client didn't need to produce
accounts or a tax return.
--
Jon Griffey FCCA ATII
Hackett Griffey
Chartered Certified Accountants & Registered Auditors
2 Mill Road, Haverhill, Suffolk, CB9 8BD

Tel (01440) 762024

www.griffey.demon.co.uk

See website for disclaimers
 
Ad

Advertisements

M

Mazy

Jonathan Bryce said:
No. Just like you don't need to mention interest received on an ISA and so
on.


Do you happen to know if the tax law is the same/similar in Ireland
for pro-gamblers? i.e. are they charged income tax?
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Top