Do I Need to Pay Tax on Casino and Gambling Winnings in South Africa?

As online betting becomes mainstream and gambling is more prevalent in South Africa, the question of gambling taxation is one that keeps coming up in punter circles. In this article, we address the question of whether you need to pay tax on your casino and gambling winnings in South Africa. We answer this question from the perspective of Sports Betting, Casino Games, Horse Racing and Lotteries so you can have complete peace of mind that SARS won’t come knocking at your door.

Does South Africa tax gambling winnings?

As a South African, you’re liable to pay value-added tax (VAT) on goods you buy as well as income tax if you earn more than R95 750 per year. But what are the tax rules and SARS requirements when it comes to online betting in South Africa?

Well, here’s the good news. If you have a day job and only gamble casually like most online players in South Africa, then your winnings won’t be taxed at all. On the other hand, if gambling is your only source of income, SARS will deem this as a profit-making activity and your winnings will be subject to tax. 

However, even if you’re just a casual punter, we recommend declaring your gambling winnings to SARS as non-taxable income to be on the safe side. Why? Because as long as you can prove you have other sources of income aside from betting, you won’t be liable to pay tax on any winnings.

Tax on casino and gambling winnings in South Africa

Gambling winnings for individuals are not currently subject to tax in South Africa unless gambling is that person’s only business or trade. So whether you’re betting on Sports, Casino Games or Lotteries online in South Africa, you won’t have to pay any tax on your winnings. One exception to this rule is the 6% tax on horse racing. However, this tax is deducted from your winnings by the bookie and paid to the relevant gambling board on your behalf before you even see the money. The only requirement for punters in South Africa is to declare to SARS each year from where they received funds if winnings are paid into their bank account. If the amounts aren’t huge then you shouldn’t be stressed about reporting them though.

Horse racing tax in South Africa

Horse racing is the only form of online betting in South Africa where the individual winning a bet is taxed. But as this 6% fee is deducted by the bookmaker as soon as your winning bet is settled, you might not even notice it’s been paid on your behalf.

Here’s how the tax on horse racing in South Africa works in real terms: If you bet R100 on a horse at odds of 2.00 (EVS) and win, instead of receiving R200 back in total, your payout will be R194 as the 6% horse racing tax will have been automatically deducted from your winnings. 

Do you pay tax on Hollywoodbets winnings?

The only tax you’ll pay on Hollywoodbets winnings is from bets on horse racing. However, there’s no need to worry about paying any additional tax to SARS unless you’re a full-time punter with no other sources of income. That said, it’s still advised that you declare your gambling winnings to SARS as non-taxable income to avoid any potential penalties or prosecution.

No horse racing tax for Betway customers in South Africa

Punters are often frustrated at having to pay horse racing tax, especially when all other forms of betting, including lottery games in South Africa are tax-free! In response, Betway launched its Tax Scratch Promotion for the 2023 Durban July, which saw the bookmaker remove the 6% tax on all horse racing bets for their South African customers. Until further notice, Betway will now pay the horse racing tax on your behalf so you can receive a 100% payout on every winning bet!

Want to take advantage of Betway’s Tax Scratch Promotion on horse racing? Sign up now and receive a Matched Bonus on your First Deposit of up to R2000! Also, don’t forget to visit the Gambler’s Homepage for more on games, lucky numbers, sports betting and listings of the best betting sites in South Africa.