ATO rules for real money games
The Australian Taxation Office (ATO) regulates how income generated from real money gambling is taxed. This concept includes both terrestrial casinos and poker tournaments, as well as online gambling platforms, including bookmakers and games with live dealers.
General provisions
For most individuals, random winnings are tax-free.
If gambling is professional or systematic, the proceeds are taxable as business profits.
Winnings abroad may be taxable depending on international agreements.
The criteria by which the ATO determines taxable income are:
ATO requirements for real money players:
Keeping records of each transaction: date, amount, type of game, venue.
2. Saving documents
Storage of receipts, bank statements, rate confirmations for at least 5 years.
3. Declaration of income
Indication of taxable winnings in the annual return.
4. Expense accounting (for professional players)
Ability to claim deductions for activity-related costs.
Liability for non-compliance:
Examples of situations:
Conclusion
The ATO rules for real money games in Australia are based on determining the nature of the gaming activity. If it is professional or regular, the winnings are treated as taxable income, requiring reporting and documentary evidence. Compliance with these rules reduces the risk of fines and tax audits.
General provisions
For most individuals, random winnings are tax-free.
If gambling is professional or systematic, the proceeds are taxable as business profits.
Winnings abroad may be taxable depending on international agreements.
The criteria by which the ATO determines taxable income are:
- 1. Regularity and scale of the game - constant bets, a large turnover of funds.
- 2. Having a strategy and training - using professional skills to make a profit.
- 3. The dependence of income on the game is if it is the main source of livelihood.
- 4. Financial accounting - Having fixed records of game-related income and expenses.
ATO requirements for real money players:
- 1. Transaction accounting
Keeping records of each transaction: date, amount, type of game, venue.
2. Saving documents
Storage of receipts, bank statements, rate confirmations for at least 5 years.
3. Declaration of income
Indication of taxable winnings in the annual return.
4. Expense accounting (for professional players)
Ability to claim deductions for activity-related costs.
Liability for non-compliance:
- Financial penalties for non-recognition of income.
- Late tax penalties.
- Criminal liability for intentional evasion.
Examples of situations:
- The player visits the casino once a year and wins by accident - there is usually no tax.
- A professional poker player participates in tournaments on a monthly basis - income is taxed.
- The online bettor makes regular profits from sports betting - it must be declared as business income.
Conclusion
The ATO rules for real money games in Australia are based on determining the nature of the gaming activity. If it is professional or regular, the winnings are treated as taxable income, requiring reporting and documentary evidence. Compliance with these rules reduces the risk of fines and tax audits.
