Question Crypto casinos : are winnings taxable in the UK?

[G1000]

Hi all,

Recently started using crypto casinos having taken a break from gambling. Absolutely zero trouble with withdrawing, genuinely very impressed with the experience.

One area that seem vague is the tax aspect of this for UK users. Are these still gambling transactions even if they are with crypto casinos? Or are you liable for Capital Gains if you go over a certain amount?

 

[justdoit]

you not trading or giant profit from trading, all you doing buy crypto and send to casino, tax should be only if you giant profit from trading

 

[slot_zombie]

It's still gambling so no tax applies

 

[toms596]

Be nice if I could claim my losses on tax

 

[G1000]

Been looking for further confirmation on this but can't find any anywhere

 

[dunover]

Been looking for further confirmation on this but can't find any anywhere

There's no tax on winning for UK gambling, ever.

You would pay tax on profits from crypto trading, same as any other business.

But you have a grey area here - all LEGITIMATE UK-facing gambling businesses pay the gaming tax, so there's no official UKGC licensing for crypto casinos AFAIK. Thus technically it's a non-question as officially there's no crypto gambling under the UKGC's jurisdiction - if there was, you would pay no tax on winnings same as with non-crypto.

So the answer to your question is no, as you are winning from gambling and not trading.

 

[satchnz]

There's no tax on winning for UK gambling, ever.

You would pay tax on profits from crypto trading, same as any other business.

But you have a grey area here - all LEGITIMATE UK-facing gambling businesses pay the gaming tax, so there's no official UKGC licensing for crypto casinos AFAIK. Thus technically it's a non-question as officially there's no crypto gambling under the UKGC's jurisdiction - if there was, you would pay no tax on winnings same as with non-crypto.

So the answer to your question is no, as you are winning from gambling and not trading.

Interesting to know.

Even if there was a tax on crypto gambling, would it not be liable until the point that you turn your crypto into fiat?

 

[dunover]

Interesting to know.

Even if there was a tax on crypto gambling, would it not be liable until the point that you turn your crypto into fiat?

Who knows? Maybe the UKGC will develop some strategy for the crypto sites/UKGC sites allowing crypto - including starting with approving them for UK licenses or UK players to use crypto at existing licensees. Don't hold your breath though as with most scenarios it will take them years to do anything.

 

[Reelsoffun]

I doubt the UKGC will bother, as everyone knows the main reason a UK player uses crypto in the first place is to get back auto play, bonus buy and fast spins. No UK player is going to bother using crypto on a UK casino.

 

[interlog]

The issue is, I think, how you're going to proof that those winnings came from gambling. You have money leaving your account to a Crypto exchange and then money going from the Crypto exchange back to your account.

How are you going to convince HMRC that any surplus into your account is gambling related and not because of a return on crypto investment?

Unlike a conventional UK licensed casino where your money is leaving your bank account into the UK licensed casino and vv. Pretty easy to demonstrate that it is gambling related by virtue of the money going backwards and forwards to a UKGC casino

 

[dunover]

The issue is, I think, how you're going to proof that those winnings came from gambling. You have money leaving your account to a Crypto exchange and then money going from the Crypto exchange back to your account.

How are you going to convince HMRC that any surplus into your account is gambling related and not because of a return on crypto investment?

Unlike a conventional UK licensed casino where your money is leaving your bank account into the UK licensed casino and vv. Pretty easy to demonstrate that it is gambling related by virtue of the money going backwards and forwards to a UKGC casino

Simply download and print your gambling transactions from said casino.

 

[interlog]

Simply download and print your gambling transactions from said casino.

Easily said than done in my opinion. The said casino account is not licensed in the UK for a starter and on most you don't even have to submit your name and address to get verified so you may find it difficult to demonstrate that those casino transactions are indeed yours.

Unlike the UKGC licensed casinos where KYC is a prerequisite to be able to play.

In my opinion, if you were to win big and HMRC was so inclined to see those winnings (that they see as surplus dosh going into your bank account) as taxable you are up against it.

Just my 2p worth that may well be equal to talking out of my arse!

 

[dunover]

Easily said than done in my opinion. The said casino account is not licensed in the UK for a starter and on most you don't even have to submit your name and address to get verified so you may find it difficult to demonstrate that those casino transactions are indeed yours.

Unlike the UKGC licensed casinos where KYC is a prerequisite to be able to play.

In my opinion, if you were to win big and HMRC was so inclined to see those winnings (that they see as surplus dosh going into your bank account) as taxable you are up against it.

Just my 2p worth that may well be equal to talking out of my arse!

The onus is on HMRC to prove their accusation, not the other way around.

 

[interlog]

The onus is on HMRC to prove their accusation, not the other way around.

But surely it is the other way round. It is YOU claiming that it is not taxable income going into your bank account. I guess it is exactly the same when you claim tax relief on your income and you will have to provide receipts for it.

I am sure for the ordinary gambler, winning a few £'s here and there, you will never have this issue but if you were to win say a jackpot of a few £million then I am sure HMRC will be asking questions where the money came from and why you think it should not be taxable.

 

[dunover]

But surely it is the other way round. It is YOU claiming that it is not taxable income going into your bank account. I guess it is exactly the same when you claim tax relief on your income and you will have to provide receipts for it.

I am sure for the ordinary gambler, winning a few £'s here and there, you will never have this issue but if you were to win say a jackpot of a few £million then I am sure HMRC will be asking questions where the money came from and why you think it should not be taxable.

You're right - they would ask, you tell them and then they go away and try to find some kind of mechanism to excuse taxing you. Then you contest it and they must prove it did not come from gambling. You have proof it does, thay have no proof to the contrary.

P.S. Assuming it's held in a btc account they wouldn't even be aware of it until you converted it. The bank would probably do a 'Bandit' on you before the IRS ever became involved.

 

[interlog]

You're right - they would ask, you tell them and then they go away and try to find some kind of mechanism to excuse taxing you. Then you contest it and they must prove it did not come from gambling. You have proof it does, thay have no proof to the contrary.

P.S. Assuming it's held in a btc account they wouldn't even be aware of it until you converted it. The bank would probably do a 'Bandit' on you before the IRS ever became involved.

Agreed that whilst it sits in your crypto wallet, nobody is to know any better. It is when it hits your bank account that the problem may arise. You mentioned "Bandit" and I would not be surprised at all authorities (whether that be them direct or indirect via the bank) poking their ore in where all that money going out and in is coming from. More easier proved with a UKGC casino than some crypto casino that doesn't even do the basic KYC checks or worry what name you enter when you register.