Do You Pay Tax on Horse-Racing Winnings in Australia?

Published on January 4, 2025

Betting on horses offers excitement — and occasionally, unexpected tax questions. In this comprehensive guide, we explore everything you need to know about tax on horse racing winnings Australia and answer whether do you pay tax on betting winnings. You’ll understand the ATO’s position, key legal rulings, hobby vs professional distinctions, deductions, GST implications, and offshore wins. You’ll also find related resources from horise.com.

Disclaimer: This is not financial or tax advice. Always consult a qualified accountant for your situation.

1. Australian Tax Basics & the ATO’s Position

In Australia, casual punters do not pay tax on their horse-racing winnings. The Australian Tax Office (ATO) treats these as “windfalls”, not income. This means that unless you’re running a betting operation like a business, your winnings are tax-free.

If you’re betting systematically with an intention to profit and applying structured strategies, however, things change. You may be classified as a professional gambler, and the income becomes assessable.

2. Hobby vs Professional: What the ATO Considers

The ATO examines a range of factors to determine your tax status. These include:

  • Frequency of bets
  • Systematic strategy and use of software or form guides
  • Record-keeping of wins and losses
  • Time commitment
  • Commercial intent

Legal Rulings & ATO Guidance

  • Taxation Ruling TR97/11: Lists criteria to determine if an activity is a business.
  • FC of T v Ashby (1981): Confirmed hobby betting is not taxable.
  • CR 2010/2: Ruled that full-time professional punters must report betting income.

If you’re using structured strategies like those from Top 5 Winning Strategies or How to Bet on Horse Racing, you could be edging into taxable territory.

3. Record-Keeping Checklist (If You’re Near Business-Level)

Good records are vital if your betting might be classified as professional. Use this checklist to stay prepared:

Record TypeDetails to Include
Betting Slips/TicketsDate, race, stake, odds, result, and bookmaker
Bank StatementsAll deposits/withdrawals to/from betting accounts
Strategy NotesYour betting rationale, tools used, and methodology
Profit & Loss LogsTrack returns per race, per week, and monthly
Expenses ReceiptsSoftware subscriptions, analytics tools, racing data feeds

Need help reading form? See Horse Racing Form Guide.

4. Tax Treatment: Hobby vs Professional

Hobby Bettor

  • Winnings: Tax-free
  • Losses: Not deductible
  • GST: Not applicable

Professional Punter

  • Winnings: Counted as income
  • Losses: Deductible
  • GST: Applicable if income > $75,000 and registered for GST

If you’re analyzing track variables or using betting systems, our Track Conditions Guide may already be part of your toolkit — another sign of professional-level activity.

5. FAQs – Tax on Horse Racing Winnings

Is GST payable on winnings?

No. GST does not apply to gambling payouts. It only applies to services or products sold in business.

Are overseas wins taxable?

  • Hobbyist: No.
  • Professional: Yes, once converted into AUD.

Can I claim betting losses?

Only if you’re considered a professional punter operating a business. Hobby losses are not deductible.

Flow Chart: Are My Winnings Taxable?

I bet every week with systems — will I be taxed?

Potentially. If your setup resembles a business, including detailed record-keeping and profit focus, ATO may consider your income assessable.

What about betting across multiple platforms?

Multiple betting accounts and tools don’t automatically mean business, but they strengthen the case for professional intent.

6. Flow Chart: Are My Winnings Taxable?

Flow Chart: Are My Winnings Taxable?

7-Step Summary Strategy

  1. Casual punter? Don’t worry about tax.
  2. Systematic strategy? Keep full records.
  3. Maintain betting logs, expenses, and intent.
  4. Use Horise guides to stay sharp — like Expert Horse Racing Tips.
  5. Watch your turnover — consider GST if high.
  6. Consult an accountant if you make serious gains.
  7. Don’t claim losses unless you qualify as a business.

8. Real Cases

Ashby Case

A hobbyist bettor couldn’t deduct losses. Confirmed the principle that casual gambling is not a business.

CR 2010/2

Full-time punters with methodical betting and documentation were deemed businesses — and had to declare earnings.

9. Horise Guides & Resources

10. Disclaimer

This guide does not offer legal, tax, or financial advice. Laws and rulings may vary. Speak to a certified tax professional regarding your personal tax obligations or strategies.

Conclusion

Understanding tax on horse racing winnings Australia boils down to context. If you’re punting for fun, your wins are likely safe from tax. But if you’ve turned betting into a business, with strategies and stakes to match — you may be liable.

Use this guide, follow Horise’s expert advice, and above all — stay compliant, stay profitable, and enjoy the races.