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Countries with tax free gambling

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  • #392
    3rdeye
    Member
    • Total Posts 30

    Hello,

    I am thinking of leaving the USA for a number of months so that I can have a vacation and bet on the betting exchanges legally (i can’t be from the USA legally).   I have been brain storming where I should go, and one consideration is gambling taxes.  I have to declare my winning to the US government, so I don’t want to be taxed twice.  My understanding is that the UK does not tax your gambling winnings (you are so lucky).  Does anyone know of other countries where I could go to, bet on the exchanges, and not owe taxes on it.   Say, the Carribean maybe or Canada?  I am trying to look at all of the options right now.  Thanks in advance for any replies.

    #30013
    wit
    Participant
    • Total Posts 2152

    3rdeye

    *********************************************<br>The following are casual, general observations, not legal/tax advice for any specific person  (as to which, always go to relevant CPA(s) / lawyer(s)):<br>*********************************************

    1.    almost no country – whatever its tax regime for its locals – imposes charges to income tax on a pure tourist visitor who is present for no more than 90 days in its tax year

    <br>2.    very few countries impose a "withholding on account of income tax" on punting winnings of tourists –  and where they do (as in the US) such withholding can often be avoided by filing a form claiming OECD tax treaty benefits:

    http://www.irs.gov/businesses/small/int … 52,00.html

    <br>3.     relatively few countries (the US is an exception) charge to income tax (or withholding)  the punting winnings even of their locals.    

    Canada doesn’t, but they have to be demonstrably bona fide punting winnings,  not an attempt to disguise the source of otherwise taxable income (ie keep detailed records):

    http://www.cra-arc.gc.ca/E/pub/tp/it334 … 4r2-e.html

    Gambling is illegal on some Caribbean islands (eg Cayman) and taxable on others.    Haven’t surveyed attitudes in the various islands to internet betting by their tourist visitors, but note that most telecom/internet services from the Caribbean route back through the US.

    <br>4.    even if within a charge to tax outside the US, the chances of a US passport- holder – who is ready to live with being taxed once by virtue of holding that passport – having to suffer a second charge to tax elsewhere are not that great.    

    Preventing double taxation is what the OECD tax treaties are about and the US is party to a wide network of them.  

    <br>5.    be aware that tax authorities around the world are far more liberal than they used to be in exchanging information under the tax treaty network, and have greater powers than previously to force disclosure locally of info they have been asked for via such network.  

    best regards

    wit

    (Edited by wit at 12:06 pm on Nov. 4, 2006)

    #30014
    3rdeye
    Member
    • Total Posts 30

    Thanks again Wit.  One more question, if I was to stay longer than 3 months in the UK, would I have to declare and pay taxes on winnings to the UK?  They don’t tax their locals punting winnings, how about tourist that stay for over three months?

    #30015
    wit
    Participant
    • Total Posts 2152

    no, no UK tax in such an event.

    the thing about 90 days is that there’s a tax rule that if a visitor spends more than an average of 91 days per annum over any 4 year period, he becomes tax resident in the  UK.    (the days don’t include days of arrival or departure tho).

    that has no consequence as regards winnings from punting, since UK tax resident punters don’t pay on those anyway.

    but it does mean that the visitor gets a UK tax footprint that could be an issue if he’s also getting other types of income (albeit it would be more an admin thing under the US/UK double tax treaty rather than a double charge to tax).

    as regards countries where locals are taxed on punting winnings, similar 90 day rules though could have an impact on the visitor.

    <br>the UK tax rule is sometimes overlooked by visitors, since UK immigration rules still class a person as a visitor up to 182 days a year for immigration purposes (and – regardless of 91 day averages- he’ll also be UK tax resident if exceeding that number of days in the UK in any single UK tax year, which runs from April 6 – April 5)

    best regards

    wit

    (Edited by wit at 1:40 pm on Nov. 4, 2006)

    #30016
    davidbrady
    Member
    • Total Posts 3901

    Ireland is also tax-free as regards betting income. As regards liabiliy to Irish tax on other sources of income, you will be treated as non-resident, non-ordinarily-resient, & non-Irish-domiciled. This basically means that you will be taxed on all Irish source income (assuming that the income is actually taxable in the first place, of which betting income is not).

    If the above is not clear give me a PM or post again on the forum and I’ll see what I can come up with OK!

    #30017
    3rdeye
    Member
    • Total Posts 30

    Thanks for your reply and the information Davidbrady.  I am new to this forum, but my experience on this forum so far has been just great.  Everyone has been very helpful and I do appreciate that.

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