Gambling Taxes Uk
Register For Gambling Tax Aimed at companies, this Gov.UK page describes the measures needed to offer remote gambling to UK players. Gambling Duties - News & Announcements Keep up-to-speed with the latest notifications and developments in gambling tax from the HMRC. Gambling (Licensing & Advertising) Act 2014. Latest news: Gambling Commission welcomes publication of Gambling Act Review Call for Evidence We license and regulate the people and businesses that provide gambling in Great Britain including the National Lottery.
It’s difficult to do anything in life without having to pay the government in the form of tax. So surely the gambling industry is no exception?
Gambling Taxes Uk Calculator
If you expect you need to declare your gambling winnings to the government, you might be in for a surprise.
The gambling tax explained
The UK gambling tax system is very advantageous to players. Not only does it work out in your favour, but it is also incredibly easy to understand.
Whenever you gamble in the UK, you are not required to pay any tax whatsoever. You don’t have to pay tax on your winnings and there’s also no need to pay any tax on your initial stake either.
This, of course, means you don’t need to report your winnings to the taxman. If you win £5,000 at an online casino, you get to keep that amount in full! This is a great improvement on the policies of other countries where you don’t actually get to keep all of your winnings.
Who gets taxed?
So how is this all possible? The gambling industry is worth a lot of money, so why is the government not taxing it?
Instead of taxing the players, the UK government actually taxes the operators. But this wasn’t always the case. In the past, you used to pay a tax to the government either as a tax on your stake or as a tax on your winnings. What changed then?
In 2002, the UK government was concerned the British gambling industry wasn’t going to be able to compete with the rise of online gambling sites in UK. This led the government to .
As we can see today, the decision was a successful one. The UK gambling industry is still alive and well to this day.
What about professional gamblers?
Professional gamblers might actually have one of the only professions that are not actually taxed in the UK. If you are lucky enough to gamble for a living, you don’t need to pay the tax man a penny on your gambling winnings.
The reasoning for this is fairly simple. If the government was allowed to tax you for doing a certain activity such as gambling, under the current tax system, you would have the ability to claim money back from the government for your losses.
The UK government does not want to open the floodgates for everyone who loses money gambling to claim money back. Not only does this mean professional gamblers won’t ever be taxed, but it also means the gambling tax is unlikely to return any time soon.
How did operators react?
It’s no surprise that casino operators were not too thrilled about this new taxation system. Operators looked for a way to pay as little tax as possible.
Some of them starting running their businesses out of “tax haven” countries. These countries require casino companies to only pay a very small amount of tax compared to the UK. This is a big reason you will see certain countries such as Malta coming up over and over again in the gambling industry; they offer very favourable tax rates to casino operators.
Unfortunately for the operators, the UK government took a stand against this practice. They introduced the Point of Consumption Tax (POCT).
Enjoy tax-free gambling
The tax system for players in the UK is elegantly simple. You don’t pay any tax whatsoever on any kind of gambling transaction. It’s the operators who have to worry about navigating the UK tax system, not the players.
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The British government’s gambling tax revenue has grown dramatically since 2007 when the Gambling Act 2005 came into force. The increase in government income has also been due to the growth of online games.
The Gambling Act of 2005 paved the way for online casinos, online poker, and TV advertising for sports betting. In other words, the new legislation got companies right into people’s living rooms.
Gambling tax revenue
The gambling sector’s income, together with government gambling tax revenue, was £8.36 billion in the period Apr 2007 – Mar 2008. In the period Apr 2017 – Mar 2018, the figure soared to £14.4 billion. The National Lottery, online gaming, and FOBTs were responsible for the surge.
What are FOBTs?
According to According to topbettingsites.co.uk, which has a list of betting sites, the letters FOBTs stand for Fixed-Odds Betting Terminals.
FOBTs are electronic gaming machines on which players can place bets on the outcome of several simulated games and events. They can bet on horse races, bingo, blackjack, roulette, etc. The odds that are offered are fixed from game to game.
Gambling Commission – Industry statistics
The Gambling Commission is the UK’s gambling regulatory authority. It is an executive non-departmental public body of the British Government. Apart from regulating gaming law, it is also the sector’s supervisor. Its remit covers lotteries, slot machines, bingo, casinos, betting, and arcades. Its remit also includes remote gambling.
Remote gambling refers to any type of gambling that gaming operators provide remotely. Internet gambling and interactive TV gambling, for example, belong to this category. Cell phone gambling is also a form of remote gambling.
Gaming Commission headline findings
Below are some headline findings from the Gaming Commission regarding the gaming sector in the UK (Apr 2017 – Mar 2018):
- Gross Gambling Yield (GGY) of UK’s gambling industry – £14.4 billion.
- GGY for the Remote Casino Category (Slots) – £2 billion.
- GGY for the Remote Sector – £5.3 billion.
- Contribution to good causes from Large Society Lotteries – £296 million.
- Contributions to good causes from The National Lottery – £1.5 billion.
- Number of workers that the gambling industry employs in the UK – 107,950.
- Market share of remote casino, bingo, and betting sector – 37.1%.
- Total number of betting shops in UK – 8,406 in September 2018. This represented a 1.8% decline compared to March 2018.
- Total number of casinos in the UK – 152.
- Number of gaming machines in the UK – 181,309.
- Total number of bingo premises in the UK – 644.
We’ve been gambling a very long time
Humans have been gambling for many thousands of years. The earliest six-sided dice date back to about 3000 BC in Mesopotamia.
Gambling houses in China were widespread around 1000 BC, as was betting on fighting animals.
Dominoes and lotto games have been around in China since the 10th century AD.
Poker is the most popular card game associated with gambling in the US today. It derives from As-Nas, a Persian game which dates back to the 17th century.
In 1638, the Ridotto, the world’s first known casino, opened in Venice.
Expanding online gambling and problem gamblers
Over the last ten years, online gambling has expanded dramatically in North America and Europe. We would, therefore, expect the number of problem gamblers to have increased too. However, according to a team of US researchers, this is not the case.
Researchers from the University of Buffalo say that the percentage of problem gamblers in the United States has remained stable.
From 1999 to 2013, the percentage of problem gamblers in the US remained within the 3.5% and 5.5% range. Rates of pathological gambling also remained stable – staying within the 1% and 2.4% range.
In fact, the overall participation in gambling activities declined over this period.