Tax on Winnings

System

Whilst a genuine one-off jackpot win might be tax-free, I suspect that if you made a successful career out of backing horses or playing roulette then HMRC would regard it as a trade and tax it accordingly.

CTA_2

Think the distinction here is that, the "gambling" win comes from carrying on the trade rather than merely an opportunity arising from the trade.

Therefore, such income would be trading income IMO

http://www.hmrc.gov.uk/manuals/bimmanual/bim22019.htm

chrismac1

Not so Clifford Pope! I myself have made over £70,000 from sports bookmakers in a 6 year period and am on the way to doing something similar from financial spread bookies, since of over 100 sports betting accounts only 4 ended up accepting over £5 from me.

In each case I spent around 5 to 10 hours a week on the activity whilst carrying on a separate full time job - one as Finance guy of a business with £80m annual sales, now running my own accountancy practice.

For about 3 years I was a member of an information syndicate sharing sports betting tips. I was tennis and rugby, other guys were footie and golf, and so on. Three of these were full-time pros. One was based in the USA where such betting profits must be declared in the tax return and tax paid, bad luck mate.

The others were based in the UK and ploughed their betting profits - £80k or so per year - into rental properties. As well as making them decent cash until 2008 or so, these were their "tax shield". In my opinion this tax shield would have been effective but my opinion is irrelevant in these specific cases as HMRC never sought to challenge this stuff.

There is no better place to operate a bookie bashing operation from than the UK! Plenty of scope for creativity in the BIM that CTA has posted up.

ALIBOBSY

ALIBOBSY wrote: »

Hmm I have a simular issue. I am an aspiring writer and obviously if any items/novels are accepted for use its obviously income. I have been paid for a handful of online articles which will be declared.But for experience I am also entering writing competitions. So no pay unless you "win", but is it taxable earnings, or non taxable prize and what about ones where the prize in only a voucher?

Ali x

Think I have found my answer here http://www.hmrc.gov.uk/manuals/bimmanual/BIM50710.htm

It would appear hmrc see competitions and awards as part of literary and artistic occupations and unless it is an unsolicited award it appears to be taxable. Mind you I assume costs such as printing out entries and postal costs are reasonable deductions and most prizes are so low I doubt I will end up paying any tax even if I do manage to win anything lol.

Ali x