This year, the Melbourne Cup or the race that stops a nation, as is locally known, will be on November 5 and as it draws near, the question of whether the Australian Taxation Office (ATO) considers gambling winnings taxable often crop up.

With a total prize pool of 8 million dollars, the Melbourne Cup 2019 is expected to draw a big crowd of spectators and gamblers alike. Australia has the highest rate of gamblers in the world with 80% of its adult population engage in gambling.

Are Melbourne Cup Gambling Winnings Taxable?

So, are gambling winnings taxable? The ATO views money gained from gambling activities not as an income but as a result of good luck. In Australia, gambling winnings, including lottery winnings, are not subject to taxes.

The only time gambling winnings become taxable is when you own a betting or a gambling business and you place a bet yourself. The winnings from your bet-backs or lay-offs, as they are called, are treated by the ATO as gambling sales and gambling sales are taxable.

If you are a professional gambler, the ATO may also tax your winnings. Over the years, the ATO has pursued people who make their living from gambling. There was a cop who was fined $5500 for hiding gambling winnings from the ATO. There was also the case of Zeljko Ranogajec and David Walsh and their “Punters Club” that the ATO treated as a business and not a hobby.

Want to learn more if the ATO treats Melbourne Cup gambling winnings taxable? Read the rest of the article here.