Tax in australia?

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adace
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Joined: Fri Apr 24, 2020 12:00 am

I have researched online and even asked my accountant friend but there doesnt seem to be a solid answer to do i pay tax in australia if i become a fulltime betfair trader? The official answer online is you dont pay tax on gambling winnings in australia.....but what happens at tax return time? Anyone out there have any experience with this in australia?
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ShaunWhite
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Joined: Sat Sep 03, 2016 3:42 am

Do you guys pay tax on gambling winnings in general as they do in the US? The reason I ask is that we don't in the UK and therefore gambling winnings on Betfair aren't taxable either. Comes down to the job title you give yourself, "betfair trader" is just a made up name for a style of gambling, so whatever the laws are around gambling in general would probably apply. Well that's the UK perspective and I'm sure someone from your part of the world will elaborate.
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Naffman
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99.9% sure its the same as the UK where gambling is considered a hobby where you are expected to lose, but if you start employing people then it enters a grey area.
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ShaunWhite
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Joined: Sat Sep 03, 2016 3:42 am

Naffman wrote:
Wed Feb 23, 2022 2:49 pm
99.9% sure its the same as the UK where gambling is considered a hobby where you are expected to....
..... shove your winnings in your back pocket and keep schtum because they can't check it anyway. ;)

This is why the trend towards digital money is a worry for me, paying in cash gets you a discount and being paid in cash means its all yours. No sane adult would encourage traceability.
deestar
Posts: 178
Joined: Thu Feb 20, 2020 6:17 pm

In Australia (and New Zealand for that matter in case you are thinking of moving to God's Own) it comes down to whether you are carrying on a business or trade. See here

https://www.ato.gov.au/law/view/documen ... 1231235958

"Hill J indicated that today mere punting, particularly with the growth of modern technology such as computers, could be so organised, systematic and businesslike and so dedicated to profit-making as to constitute a business. However, his Honour went on to say that the intrusion of chance into the activity as a predominant ingredient at least in the outcome of the race itself suggests that it will be a rare case where a court will conclude that the activity is a business."

So potentially yes.
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gazuty
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Joined: Sun Jun 26, 2011 11:03 am
Location: Green land :)

The basic position is that gambling winnings in of themselves are not taxable. I presume you are doing it recreationally and not "professionally". You might want to consider how you describe yourself to other people if you decide to give up other sources of income. Might even be worth being involved in the gig economy (uber, deliveroo, whatever) as your main profession so that you have an interest in gambling as a hobby.

In addition, you might want to factor other risks in to your position. The exchange may not always exist in Australia (or anywhere for that matter). What happens if the exchange is shut down in Australia?

Some people have gone and received a private ruling from the ATO as to whether or not their activities are taxable - there are a number of "value" bettors (ie non traders, people who use models to bet on outright outcomes - no greening - who have rulings that say their winnings are non-taxable). The ATO can look at certain people's activities and lifestyles and wonder how their lifestyle is funded. That is why some people spend a lot of time at the casino, the old "I'm not a drug dealer, I just won the money playing roulette and that's how I got my house, flashy girlfriend and yellow lambo".

Finally there was an ATO case against the Punters Club members including Zeljko Ranogajec and David Walsh see https://www.examiner.com.au/story/40978 ... ax-office/

Basically, the ATO knows that most gamblers are long term losers, there are few long term winners. The ATO does not want a really well organised long term loser to start claiming losses as a tax deduction. The ATO would almost certainly say "no deduction for gambling losses - no matter that you spent time developing a model, were systematic, purchased software and api access etc etc". If the activities are large enough and meaninful enough then it will be like the Punters Club case.
adace
Posts: 6
Joined: Fri Apr 24, 2020 12:00 am

Thanks everyone for your thoughts.....
adace
Posts: 6
Joined: Fri Apr 24, 2020 12:00 am

Anyone here in Australia using a vpn to bet on the UK betfair? Send me a pm if not want to publicise it...
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gazuty
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Joined: Sun Jun 26, 2011 11:03 am
Location: Green land :)

adace wrote:
Wed Mar 02, 2022 12:30 pm
Anyone here in Australia using a vpn to bet on the UK betfair? Send me a pm if not want to publicise it...
https://www.betangel.com/vps/
Borisbulldog18
Posts: 4
Joined: Thu Feb 10, 2022 4:55 pm

Anyone have any view on this please for tax?

I am systematically trading sports via api. If I were to become a company (so I can legally share splits of the business with my partners) then use a corporate Betfair to bet would I likely be liable for tax on winnings? The issue is as partners they don’t want to send large sums to my account and bet in my own name, with a company we can all ensure security of funds.

Also any corporate uk bank account recommendations so I can put money in Betfair as a company. Will any uk banks give me an account where I can put cash in Betfair or do I need to go offshore?

All help is welcome tvm.
RichieT
Posts: 10
Joined: Fri Apr 01, 2022 12:20 pm

Borisbulldog18 wrote:
Fri Mar 11, 2022 11:10 am
Anyone have any view on this please for tax?

I am systematically trading sports via api. If I were to become a company (so I can legally share splits of the business with my partners) then use a corporate Betfair to bet would I likely be liable for tax on winnings? The issue is as partners they don’t want to send large sums to my account and bet in my own name, with a company we can all ensure security of funds.

Also any corporate uk bank account recommendations so I can put money in Betfair as a company. Will any uk banks give me an account where I can put cash in Betfair or do I need to go offshore?

All help is welcome tvm.
Becoming incorporated will result in you having to pay 25% in company tax. There is no workaround for this, it is enshrined in legislation. It would require very creative accounting to minimise the CT paid on profits and incorporation brings with it a whole world of headaches that you'd want to avoid unless it was absolutely essential.

You can get a private tax ruling from the ATO (as a non incorporated entity obviously) which is legally binding and all syndicates that I am aware and have gone down that route have been assessed as not being liable to pay tax. Z's gang had a stoush with the ATO years back now which resulted in everyone betting in any sort of volume to get a tax determination preemptively.

Being a company doesn't protect your partners/investors contributions anyway. If the director wants to pull a swifty, they can just as easily do it in a company as they could in an informal punters club.

Talk to an accountant of course but the short answer is no, a company structure is of no benefit to a professional punters.
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