UK Gambling Taxes Explained

Gambling Taxes Explained

If you've never won at a casino before in the UK, or even when you have won at a casino you might not know anything about the tax laws surrounding gambling. The good thing for most UK players is that they won't have to pay taxes on any of their winnings, but it's still important to understand the laws, how they came to be, and what to expect when visiting other countries.

Casinos Online And Offline Have To Pay Taxes

Any casinos that accept UK players are expected to pay a 25% tax for any money they earn from those players. That means if you're operating a casino online and a UK player visits the casino and loses £1,000, you'll have to pay £250 on that money to oblige with current tax laws. The government passes all the expenses on to casino operators because they are the ones making a business out of gambling.

Casino Players And Taxes

It was very common for UK players to have to pay taxes on their winnings before 2002, in fact most players betting on sports ended up paying a tax of about 9 per cent, but all that changed between 2002 and 2005 thanks to a bunch of sweeping legal adjustments.

In 2002 Chancellor Gordon Brown reworked the tax law surrounding bookmakers so that betters would no longer be taxed at all and the operators would receive a tax of about 15 per cent. This was done to keep players from placing bets with companies overseas and to help bring more tax revenue to the country.

In 2005 a new set of gambling rules and regulations known as the Gambling Act 2005 was put into place. It make poker much easier to gain access to and also took away taxes on poker, bingo and all the other casino games out there. The law made it so that players didn't have to pay taxes on their winnings any longer.

No Taxes for You

Because of the legal changes mentioned above, UK players can enjoy sports betting, poker, slots or any other casino game that they like to play and won't have to pay any taxes on winnings that they receive. That's great news for full-time poker players, and also a nice perk for anyone who managed to hit it big at a UK casino both online or offline. The government makes up any lost revenue by taxing the companies running the casinos, so they win from the adjustment as well.

Gambling In Las Vegas

Las Vegas is a major gambling hub for people around the world and poker players especially want to get in on some of the massive tournaments in US. What many UK players don't realise is that players from the United States pay taxes on any gambling win that they enjoy. That means that UK players are expected to pay those same taxes, or does it? Even though you would assume that players from the UK would be subjected to the same tax laws in the United States, that's not the case. The UK has an agreement with the United States that allows UK players to have their winnings handled under UK tax laws. That means they aren't taxed at all. In order to avoid being hit with taxes you have to file some special tax forms though, and it's possible your winnings will be held up by the IRS (Internal Revenue Service) until it's processed, at which point you'll get the money back.

There are lots of rules and regulations surrounding gambling taxes, but the laws in the United Kingdom are pretty straightforward. If you're operating a casino you'll be paying taxes, otherwise you can enjoy your winnings without paying in any of them.