Casino Taxation in Australia: Basic Rules & Aspects

In the 18th century, Australia experienced the first forms of gambling, which were card games, sports betting, especially horse racing, and more. The next century was even more beneficial since the first official horse race was established in Sydney in 1810. Then, Aussies experienced the big lottery boom, though it led to certain fraudulent problems, so some forms were prohibited soon. In 1973, Australians were lucky to visit the first official and legal land-based casino. It was Wrest Point Hotel Casino in Hobart, Tasmania. 

Soon, the government accepted more brick-and-mortar operators since it’s the best way to control the activity, provide proper safety measures, and receive taxes paid by operators to boost the local economy. In the 1950s, the country was friendly to pokies which used to be land-based machines. And now, this entertainment is all available online, though the Interactive Gambling Act (IGA) has certain restrictions in this regard, so Aussies can opt for offshore-licenced sites instead.

Here in Australia, players can access different forms of gambling, including online and brick-and-mortar variations, which makes Australian tax laws different depending on this type. In general, they are all controlled by ATO (Australian Taxation Office), so you can always visit its official website for more details. 

Basically, gamblers pay betting tax once the WA taxable betting revenue exceeds the threshold of $150,000 per assessment year. In this case, the tax is 15% the amount which exceeds this limit. For example, if the threshold is $160,000, you’ll pay 15% of the $10,000 amount ($160,000 minus $150,000).

As for the most popular gambling types in Australia which make the tax rate vary, these are the ones Aussies can access:

• Online gambling
• Gaming machines (online pokies)
• Lotteries like Keno
• Betting and sports betting
• Casino taxes (charged on the operator’s side)

Besides, it’s worth mentioning that in most cases, players aren’t responsible for paying gambling taxes since it’s the duty of operators, and the rate will be different depending on the form of the services this operator provides and the area where they are provided.

As we’ve said, the tax rate may be different depending on the activity and area. This way, the government can benefit from different products provided to operators, so the payments can come from the turnover tax, tax on players’ losses, net profit taxes, and licensing fees. These categories look like this:

• Turnover tax
  Bookmakers (racing), Sports betting, Totalisator wagering on racing, Lottery subscriptions, Draw card machines, Keno
• Net profits tax
  Poker machines, Off-course totalisator investment
• Tax on player loss
  Totalisator wagering on racing, Sports betting, Poker machines in hotels, clubs, and casinos, Casinos, TAB sports betting, Keno
• Licence fees
  Casinos, Poker machines, Lotteries, Racing, Bookmakers, Sports betting, Minor gambling (bingo, raffles)

Actually, the issue of taxes for real money casino wins in Australia is very complex since the laws and all these rules vary depending on many factors, including the area, game type, and the amount players spend. In this block, our BetSquare team will cover some basic aspects to let you know when you should report your wins and what percentage should be paid.

📌Interesting to know: According to the Taxation ruling IT 2655 Income tax, if a professional gambler and/or their gambling activities are a part of a business, these wins are non-taxable, but this should be proved and the funds should be used for professional needs only.

Besides the amount associated with taxes from your potential wins from online casino games in Australia, it’s also worth considering some statistical details and interesting facts to understand how often Aussies gamble, what amounts they spend, and what the position of AU gambling laws is, so here comes our team to cover this issue:

• Jonathan Karamalikis, a professional online poker player, has raked in $4.2 million from this activity since 2007 and a further $2.1 million from live tournaments, starting with just $3 in 2007.
• The Australian gambling market is among the most boosting, which is proved by these numbers: Aussies lose $1,200 per year, which is over $24 billion per year for the entire county.
• During the fiscal year 2015–2016, gambling revenue accounted for 7.7% of the total state and territory taxation revenue in Australia.
• When considering all other revenue sources, gambling revenue constituted 2.5% of the overall state revenue in Australia. The state with the lowest rate was Western Australia (0.9%), while the highest rate was recorded in Victoria (3.2%).

The gambling tradition in New South Wales dates back centuries, with several significant milestones in Australia’s gaming history occurring in the state. Sydney’s Hyde Park hosted the country’s inaugural official horse racing event in 1810. Subsequently, in 1881, the Sydney Cup witnessed the inception of Australia’s first official lottery. Moreover, as early as 1956, registered clubs in New South Wales were pioneers in introducing legal poker machines throughout the country. Interestingly, from pokies alone, New South Wales clubs amassed a net profit of $1,945,161,625, while hotels raked in a net profit of $1,169,040,731 during the period from 1st December 2017 to 31st May 2018.

During the first quarter of 2013, poker machines in the Hunter region witnessed a remarkable turnover of $4.5 billion, indicating a notable surge of $500 million compared to the figures from 2010. On a daily basis, an astounding amount of $12.5 million was spent on these machines, equating to approximately $8,682 per minute.

In 2013, Fairfield held the record for the highest poker machine revenue in the state. From the beginning of that year until August, clubs in Fairfield generated $298 million, while pubs accumulated $93 million. Notably, this total of $391 million surpassed the combined profits from poker machines in the City of Sydney by $123 million.

Gosford boasts a substantial number of poker machines, amounting to around 1,928 units distributed among 37 different venues. Wyong, on the other hand, houses approximately 2,608 poker machines, spread across 35 venues. Notably, the Central Coast region, encompassing both Gosford and Wyong, experiences a higher prevalence of problem gambling compared to the average rate in New South Wales.

Australia is a big country, so it won’t be surprising that its laws may be somewhat different depending on the state and gambling type. That’s why our experts have analysed what regulatory authorities are in charge of different gambling forms in Australia and what documents exist to control this industry.

As for the documents regulating various gambling activities in Australia, they also vary depending on your location. For example, Racing Act 1999 and Interactive Gambling Act 1998 for Australian Capital Territory, Soccer Football Pools Act 2004 and Gaming Control Act 2005 for Northern Territory, Unlawful Gambling Act 1998 and Totalizator Act 1997 for New South Wales, Wagering Act 1998 and Lotteries Act 1997 for Queensland, Gambling Regulation Act 2003 for Victoria, Gaming and Wagering Commission Act 1987 for Western Australia, TT-Line Gaming Act 1993 for Tasmania, and State Lotteries Act 1966 for South Australia.

Our BetSquare team is responsible for your safe online gambling experience in Australia. When it comes to taxes, we explain what forms exist and who should pay these fees. In addition, we cover a range of legal issues to let you understand where you can gamble without facing problems of any kind. Plus, we want to give some tips to let you experience safe gameplay with the best odds out there:

• Make sure to read your casino’s rules attentively and pay attention to each and every detail when it comes to payments (eg. cashout limits)
• Choose software from reliable brands and check payout parameters of your game, such as an RTP and volatility
• Always play responsibly and don’t get depressed when the luck isn’t on your side since gambling is random
• Avoid blacklisted casinos in Australia and opt for trustworthy AU gambling sites from our rating instead
• Consider the legal requirements of your current location and check official sources or our site for more details
• Be open for new gambling tendencies, such as crash games adored by crypto casino players

Compared to other countries, tax laws in Australia are really different and quite friendly to players. In fact, the government believes that players lose quite often (which is, actually, proved by the fact that the house always wins in the long run) and a gambler is not a profession, so when people win (mainly, it’s an average amount), this amount isn’t your income you’ve earned. However, the ATO can track your gambling records from an official casino to analyse your spendings. 

For example, when you declare only $150,000 in your tax return but the commission notices that you’ve spent $500,000 on gambling, you may get the Amended Tax Notice to explain where you’ve got $350,000 more. Of course, it’s not a rule and you can prove that it wasn’t the amount you’ve earned that year, so you won’t face problems in this regard when you declare all your other incomes and have your documents all right.

Here in Australia, some gambling forms are prohibited, while others are fully allowed, such as land-based casinos, state lotteries, and certain online forms. That’s why this industry is taxable and can bring good benefits for the country’s economy. According to ATO (Australian Taxation Office), our team found out that the 15% tax fee is applied to gambling wins once betting revenue exceeds the threshold of $150,000 per assessment year (the tax is paid only for the amount that exceeds $150,000). 

Besides, we learned that the Taxation ruling IT 2655 Income tax law allows professional gamblers to avoid taxes for their wins since it’s their business rather than income and the funds they win are used for further bets. And finally, we’ve got a detailed table displaying that operators pay taxes instead of players, and these amounts depend on the gambling form and the location where such services are provided. Thus, our readers can relax, enjoy existing or new online casinos in Australia, and enjoy safe gambling platforms with no additional worries!