Tax on Gambling Winnings

If you are well into playing casino games and earn big through them, you would not want to lose your gambling winnings on tax. Gambling is a pretty enthralling way to indulge in for recreational purposes.

Moreover, gambling is now considered legal in most parts of the world. Both land-based casinos and online casinos are being appreciated. Does New Zealand encourage their existence as well? Let’s find out!

There are clear laws regarding the legality of land-based casinos in New Zealand. It clearly describes if gambling winnings are taxable or not. However, when it comes to online casinos, Kiwis still have to compromise a bit as there are no clear laws.

Online Gambling In New Zealand

The legality of online casinos in New Zealand is doubtful. However, Kiwis are free to play online casinos regulated and operated outside the country as long as the online casino operator abides by the New Zealand laws.

According to the Gambling Act of 2013, online casino gambling is illegal in New Zealand, and there have been no amendments in the act regarding its legislation since then.

Kiwis can try their hand on online casinos based outside the country like in Europe without any fear, though. The only disadvantage is that Kiwis have to stay a bit less updated with the new bonuses and offers due to a lack of promotional activities in the country. They may miss out on special bonuses from time to time.

Also, if any Kiwi player falls prey to the breach of conduct or unfair practices, the New Zealand government may not be able to help them fight for your right. They will have to take help directly from the casino’s local regulator.

Tax On Gambling Winnings

If you are gambling in New Zealand at a land-based casino, will you be charged with the tax on your winnings? The answer is no. If you are a casual gambler gambling at a New Zealand casino for recreational purposes, your winnings will not be taxed at any time. The casinos, pokie owners, lottery organizers, and TAB have already paid it.

Since gambling is considered a recreational sport, its winnings will not be considered as income. However, if you are a professional gambler, your winnings will be treated as your income and thus taxable.

Poker winnings are also taxable in New Zealand if the gambler has no other sources of income. In short, gambling winnings in New Zealand are taxable for professional poker players. All professional gamblers have to pay tax on their winnings as they indulge in casino games not for recreational purposes but as a medium to earn money.

Gambling Laws in New Zealand

Tax on gambling winnings in NZ is regulated by their Income Tax Act and Lottery Tax Act. In every country, the gambling laws are nearly clear when it comes to land-based casinos. However, online gambling laws are still vague.

In New Zealand, gambling laws are administered by the Department of Internal Affairs (DIA). One can also access their official website to know about the gambling winnings in detail. The New Zealand gambling law clearly describes the rules regarding gambling as to what is allowed and not. They are completely justified and liberal in all aspects.

Also, social gambling is freely allowed in New Zealand and is not taxed too. Section 22 and section 23 of the New Zealand gambling act focuses on gambling licenses.

According to Section 22, all gambling activities that don’t require machines like poker tournament housie, betting pools, etc., can be carried out without any license. Such gambling activities are defined under Class 2 Gambling.

Whether you are gambling in land-based casinos or online, there is no need to pay taxes on your winnings. The operator of the casino is responsible for paying taxes or fees for the same.

The tax is collected at source from the casino operators for running such a business. The gambling business owners must pay the taxes according to the state regulations as part of their income.