Gambling Tax Explained in Fewer Than 140 Characters

Published on 12 Apr 2019 | Last updated on 11 Nov 2021 | Reading time: 3 minutes

Tweet: In the UK, the players don’t have to pay any gambling tax whatsoever. Instead, the operators are the ones who are taxed!

Is it really that simple?

The UK gambling tax really is that simple. As a player, you have literally nothing to worry about. Play at any land-based casino, online casino or sports betting site, and you won’t ever need to pay taxes in any form to the government.

According to this article, whenever you win any money, the amount stated is yours to keep, 100%. There’s never any need to report your earnings to the government, and you don’t need to extract any amount from your winnings.

But surely there are exceptions? What if you are a professional gambler?

Even then, you still wouldn’t need to pay any tax. If you are lucky enough to be someone who makes a living from gambling, it’s made all that much sweeter by being 100% tax-free!

Has this always been the case?

In the past, gambling was actually outlawed. If you wanted to gamble back then, you would have to do it through the black market. Of course, the government never received any tax in this market.

In the 1960s, the UK government legalised gambling and betting shops started opening. Whenever you placed a bet during this time, you would have a tax of 9% levied against you. Whenever you placed a bet you had a choice: you could either pay the tax on your initial bet, or you could opt to have the tax placed on your winnings instead.

Over the years, the tax was steadily reduced. In 2002, the tax was abolished altogether. The reason for getting rid of the tax is because the government wanted the UK gambling industry to remain competitive.

Online gambling was quickly gaining popularity and the gambling tax meant the UK risked losing profit to other countries. The move was a successful one and the UK remains one of the best gambling markets in the world.

Is every country the same?

Not every country has gambling laws that are as generous as the UK’s. In fact, some foreign taxation systems are nowhere near as friendly to players.

For example, say you are lucky enough to win the lottery in the Netherlands. Unlike in the UK, you won’t actually be able to keep the whole amount. The government would take a massive 29% of your winnings.

If you are planning on doing some travelling and you want to play in foreign casinos or use foreign betting sites, make sure you do your research! Don’t make the mistake of thinking every country is as generous as the UK.

Is the current system here to stay?

So do UK-based gamblers need to worry about the government taking 29% of their winnings any time soon? Fortunately, that seems pretty unlikely. The current system has been in place for quite a number of years and there are no signs that the government has any plans to change it.

The gambling industry in the UK is huge and despite not taxing the player, the government still makes a tidy sum of money from it. They won’t want to do anything that could damage the industry.

Under the current UK tax system, if you can make money from doing an activity, you are required to give allowances in the event you lose money doing that activity. If gambling was taxed again, this could open up the floodgates for people trying to claim allowances for their gambling losses.

Enjoy tax-free gambling

From the perspective of the players, the UK gambling tax is one of the easiest to understand in the world. For any kind of game or transaction for both land-based and online casinos UK wide, you will always pay a grand total of 0% tax.