Are gambling winnings taxed in Australia? For most people, no. The Australian Taxation Office (ATO) lists ‘betting and gambling wins (unless you operate a betting or gambling business)’ among amounts that are not counted as income, and the ATO's guidance on gambling carried on as a business is a ruling dated 17 October 1991. This guide covers what the rule says, who it applies to and where it stops. It gives general information and is not tax or legal advice.

What the ATO says about gambling wins

The ATO publishes a list of amounts that a business leaves out of its income. On that list, in a page last updated on 7 May 2025, sits ‘betting and gambling wins (unless you operate a betting or gambling business)’. The same list names ‘earnings from a hobby’ and ‘prizes and awards not related to your business’. The page is written for businesses, so it is a starting point and not the whole answer.

For individuals, the ATO's instructions for question 24 of the 2026 supplementary tax return, updated on 18 August 2026, do not list gambling winnings among the other income to include. They also leave ordinary lotteries out. The wording matters. Saying the instructions do not list winnings is not the same as saying nobody ever has to declare one.

The ATO does not sort this rule by game. Its words are ‘betting and gambling wins’, and that phrase should not be stretched into a list of games the page never gives.

Three kinds of people sit behind the rule. A person who gambles for pleasure has winnings that are not counted as income. A person who runs gambling as a business can be taxed on it. The operator pays tax on the business itself. The sections below take each in turn, and the legislation that governs the services is covered in what Australian law says about online gambling.

Lotto, raffles and prize draws

Lottery prizes are named directly. The ATO's page on amounts you do not include as income, updated on 8 June 2026, lists ‘prizes you won in ordinary lotteries, such as lotto draws and raffles’ as non-taxable. Its page on prizes and awards says the same thing in other words: you do not need to declare them.

Game shows get one line. The ATO lists ‘prizes you won in game shows, unless you receive regular appearance fees or game-show winnings’, so regular fees or winnings from a show are treated differently.

One exception is the bank prize draw. The ATO says you must include ‘the value of benefits or prizes you received from an investment-related lottery offered by an investment body such as a bank, building society or credit union’. The prize can be ‘cash, low-interest or interest-free loans, holidays or cars’. The ATO calls it an investment-related lottery, and it is treated differently from an ordinary one.

A prize that is an asset adds one more step. If you later sell an asset you won, the ATO's prizes and awards page says ‘you must declare any capital gains you make in your tax return’. The win is one event. The sale is another.

Why losses are not deductible

The rule has a second side. Winnings sit outside income, and losses sit outside deductions. In Brajkovich v FC of T, one of three Federal Court decisions from 1989 that the ATO's ruling builds on, ‘the gambling losses he had incurred were not deductible’. The ruling links the two points: where winnings are not assessable, losses are not deductible.

Both points follow from the same rule. No separate ATO page on gambling losses was found for this guide, so this section rests on the ruling alone.

If the losses are larger than you expected when you add them up, you do not have to work that out alone. The National Gambling Helpline on 1800 858 858 is free and confidential, and Gambling Help Online lists other ways to get support. Ideas for keeping gambling in check are collected in tools for gambling more safely.

When gambling counts as a business

The exception is gambling carried on as a business. The ATO's guidance is Taxation Ruling IT 2655, issued on 17 October 1991. It draws on three Federal Court decisions from 1989: Evans v FC of T, Babka v FC of T and Brajkovich v FC of T. In each, the question was whether a bettor with no link to the racing industry was carrying on a business.

The ruling sets out four things to weigh:

  • whether the gambling is systematic, organised and businesslike
  • the volume and size of the gambling
  • whether it is related to, or part of, other activities of a businesslike character, such as breeding horses
  • whether the person gambles principally for profit or principally for pleasure

The first factor becomes concrete in Evans. The ruling records that ‘the taxpayer did not maintain an office or employ any staff to assist him, he did not keep any records, he did not use a computer or subscribe to any tipping or information services and did not spend a lot of time studying form’. That is what the court found missing.

The ATO's own view is cautious. The ruling says: ‘The Commissioner accepts that it is possible for a mere punter to be carrying on a business of betting or gambling but considers that it will be rare for a taxpayer with no connection with racing other than betting to be carrying on a business of betting or gambling.’ Rare does not mean impossible.

Chance is treated as a point against a business. The ruling names ‘the intrusion of chance into the activity as a predominant ingredient’ as a sign that the activity is not a business, and it says other business activities in the racing industry make a business more likely. It does not name individual games, so this guide does not say how any one game would be treated.

One sentence carries a date. In 1991 the ruling noted that ‘there is no Australian case in which the winnings of a mere punter have been held to be assessable (or the losses deductible)’. That was the position when it was written. Later case law was not reviewed for this guide.

‘Professional gambler’ is not a status a person picks. It is the label that follows when the ATO or a court weighs the facts against factors like these.

Winnings paid in crypto assets

A prize paid in crypto assets adds a capital gains tax (CGT) question. The ATO page on crypto asset prizes and gambling winnings, updated on 22 June 2026, says: ‘For CGT purposes, don't include capital gains and capital losses you make directly from: winnings or losses from gambling; a game or a competition with prizes.’ It adds that ‘the cost base of the crypto asset is its market value at the time you won it’.

In an example published by the ATO, a person wins crypto assets worth $20,000 and sells them two years later for $30,000. The capital gain is $10,000, which falls to $5,000 once the ATO's discount is applied. The win was not taxed. The later gain was.

When that later event happens is a separate point. The ATO's page on crypto asset transactions says ‘a CGT event happens when you dispose of your crypto asset’. Selling a crypto asset, converting it to Australian or foreign currency and buying goods or services with it all count as disposals. How that applies to crypto used to fund a deposit at a gambling site is not covered by the pages read for this guide. It is a question for the ATO or a registered tax agent.

Payment is a different matter again. According to the Australian Communications and Media Authority (ACMA), from 11 June 2024 people cannot use a credit card or digital currency to place bets with licensed providers (see the ACMA's credit ban page). This section deals only with how a prize is taxed.

Who pays tax on gambling

Tax on gambling exists. It falls on the operator. Revenue NSW, on a page updated on 11 June 2026, says betting service providers licensed in Australia must pay a point-of-consumption tax on all bets made by customers located in NSW at the time the bet was placed. The rate is 15% of net NSW wagering revenue above a financial-year threshold, in force since 1 July 2022. Other states set their own rates.

The federal tax works differently. On a page updated on 15 September 2026, the ATO says ‘GST is payable on the margin between money received and money paid out for a gambling event’. That is the operator's obligation too.

Winnings are not counted as income, and operators are taxed. This guide does not say that one is the reason for the other, because the ATO pages do not. The obligations placed on operators reach well beyond tax, as the rules on gambling advertising show.

Winnings from an overseas website

This is where the ATO is silent. The ATO pages cited in this guide draw no line between a licensed Australian provider and one based overseas, and none of them says in terms that the same treatment applies to both. This guide does not fill that gap. A person with a specific win from an overseas website can put the question to the ATO or a registered tax agent.

Tax is a separate question from protection. The ACMA's page on protecting yourself from illegal gambling operators warns: ‘If you use an illegal service, Australian regulators will not be able to help you’. How blocking works is explained in how the ACMA blocks illegal gambling websites.

What this means in practice

The table sums up each situation as the ATO pages describe it. It is a summary of the sources above, not advice on any one case.

SituationCounted as income?Source
Ordinary win from betting or gamblingNoATO, what income to exclude
Lotto or raffle prizeNoATO, amounts you do not include
Prize from a bank's investment-related lotteryYesATO, 24 Other income 2026
Gain on selling a prize crypto assetCapital gain appliesATO, crypto asset prizes
Gambling carried on as a businessDepends on the factsATO, IT 2655
Win from an overseas websiteNot stated by the ATONone found

Where to ask and where to get help

Whether gambling winnings are taxed in Australia in a particular case depends on the facts, and a guide cannot supply them. The ATO or a registered tax agent is the place to ask.

If gambling is affecting you or someone close to you, support is available at any point. The National Gambling Helpline on 1800 858 858 and Gambling Help Online are free and confidential. You do not need to wait until things become serious.

Common questions about tax on gambling winnings

Are gambling winnings taxed in Australia?

For most people the ATO does not count them as income. It lists ‘betting and gambling wins (unless you operate a betting or gambling business)’ among amounts that are not included, and gambling carried on as a business is the exception.

Do you have to declare gambling winnings on your tax return in Australia?

The ATO's instructions for the 2026 supplementary tax return do not list gambling winnings among the other income to include, and they leave out ordinary lotteries. Gambling carried on as a business is the exception. For a particular win, ask the ATO or a registered tax agent.

Are lotto and lottery winnings taxed in Australia?

The ATO lists prizes won in ordinary lotteries, such as lotto draws and raffles, among amounts you do not include as income. Prizes from an investment-related lottery run by a bank, building society or credit union are different and must be included.

Can you claim gambling losses as a tax deduction?

Generally not. In Brajkovich, one of the three 1989 cases behind IT 2655, the losses were held not to be deductible. The ruling pairs this with the winnings rule: where winnings fall outside income, losses fall outside deductions.

When does the ATO treat gambling as a business?

IT 2655 weighs four things: whether the gambling is systematic, organised and businesslike, its volume and size, any link to other businesslike activities, and whether it is mainly for profit or pleasure. The ATO considers a business rare for someone whose only link to racing is betting.

Is there tax on gambling winnings paid in cryptocurrency?

The ATO says capital gains and losses made directly from gambling winnings are left out for CGT purposes. Selling the crypto asset later is a separate event, and the cost base is its market value when it was won. Ask the ATO or a registered tax agent about a specific case.

Are prizes from a bank's prize draw taxable?

The ATO says the value of benefits or prizes from an investment-related lottery offered by a bank, building society or credit union must be included at question 24 of the supplementary return. The prize can be cash, a low-interest or interest-free loan, a holiday or a car.

Are winnings from an overseas gambling website taxed differently?

The ATO pages used in this guide do not say. They draw no line between a provider licensed in Australia and one based overseas. For a specific win, ask the ATO or a registered tax agent, and note that the ACMA says regulators cannot help people who use an illegal service.

Sources