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The Tax Implications of making a lot of money from betting  

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Allsopp
(@mma)
Member Admin
Joined: 7 years ago
Posts: 3219
19/03/2018 8:40 am  

Hey guys,

Hope you're having a good day.

This is an important post, but unfortunately it is also a post that might only be beneficial to people that live in the UK because the Tax implications of gambling are different in every country.

In the next month or two I will be registering as self employed. All my life since I was 16 years old I have been paying tax because I have had some kind of a  job, but this month will be the first month ever where I won't be paying any taxes because it's the first time in my life where I haven't had some kind of income.

It's important to remember that while you don't have to pay Tax on money won in the UK, it is a good idea to keep records of cashflow. Many of us are making significant amounts of money every month now and we need to be able to prove where this money came from.

Soon I will be registering as Self Employed for this website which currently loses around -£750 a month and actually costs me money to keep the lights on. At the same time this year I plan on buying a decent car, going on 3 holidays and I also live in a decent sized house. If the HMRC come knocking, this is all going to look very dodgy. 

To try and protect myself against any issues that may arise in the future I am starting to keep records of deposits and withdrawals. Just screenshots, but at least it will show a paper trail.

95% of people lose money gambling and only a small percentage, probably less than 1% make as much money as we do. The HMRC is going to be extremely sceptical and dubious of what we do if we tell them that we make all this money and buy all these things from gambling profits. 

If you are living in the UK it might be a good idea to start keeping records of everything.

It's a pain in the ass, but it would hurt so much more if we got hit with a huge fine or tax bill in the future because we could not prove that all of our money is 100% legitimate.  


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Andrew
(@bondy12)
Member Admin
Joined: 6 years ago
Posts: 130
19/03/2018 10:32 pm  

Surely the transactions on your bank statement make it legitimate?

Responsibility on transactions are only on out going payments. Any money you make before they bring in a tax law you keep.


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Andrew
(@bondy12)
Member Admin
Joined: 6 years ago
Posts: 130
19/03/2018 10:46 pm  

Also, in the UK, sports betting is classed as consumption rather than investment. so technically we do pay tax by putting money into a fund that has to pay corporation tax.


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Allsopp
(@mma)
Member Admin
Joined: 7 years ago
Posts: 3219
20/03/2018 3:56 pm  
Posted by: Andrew

Surely the transactions on your bank statement make it legitimate?

Responsibility on transactions are only on out going payments. Any money you make before they bring in a tax law you keep.

If the transactions on bank statements showed that we were paying money into betting websites and then receiving money back from the betting websites then yes, that would make it legitimate.

But many of us are transferring large sums of money to family and friends to place bets and then they are sending it back to us a few months later with profit. This looks dodgy. The HMRC will want to know why your friend received £2000 and then sent back £10,000. They will want to see proof and if we can't provide proof it could land us in hot water.

 


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Andrew
(@bondy12)
Member Admin
Joined: 6 years ago
Posts: 130
20/03/2018 11:12 pm  

Ahhh shit, didn't think of that. Can you get around it in cash?


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soppie
(@soppie)
Flyweight Champion Customer
Joined: 6 years ago
Posts: 331
27/03/2018 8:10 am  

My brother in law works for the Australian Tax Office so I always ask him about the tax side of things and lucky for Aussies we don't have to pay tax on gambling either because they don't want to cover our losses. I can get more info for the Australian gamblers if requested. 

 


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LeroyPeterson
(@leroypeterson)
Black Belt
Joined: 4 years ago
Posts: 110
04/04/2018 2:53 am  
Posted by: soppie

My brother in law works for the Australian Tax Office so I always ask him about the tax side of things and lucky for Aussies we don't have to pay tax on gambling either because they don't want to cover our losses. I can get more info for the Australian gamblers if requested. 

 

I thought professional gamblers paid tax?


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