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Games vary from roulette and blackjack to video slots and video poker, from baccarat to craps, dice and poker, from roulette and cards to hand-held games and slot machines. For more on gaming in Australia, see the Australian Internet Gamers website.
Australia does not have a law on Internet gambling, but the government does consider such activity a tax deductible gambling activity, so you may deduct some gaming expenses on Form 4890-NR if they are incurred in the course of, and for the usual and customary purposes for, the activity, such as betting, betting on the result of a sporting event or gambling on the sale or promotion of products.
A person who is resident in Australia is required to declare their source of income on Form 4797, Australia Resident Income Tax Return, if gambling income is from non-gaming activity (which is most cases where a person or their spouse carries on an online business, such as a bookmaking business or a gambling website).
It should be noted that many Australian businesses consider gambling income to be income from gaming and many business owners carry on business with an online gaming licensee (usually a bookmaker) for the purpose of having their business carried on in Australia through the online online gambling licensee’s Internet site (rather than a traditional print bookmaking business), for example, to enable those business owners to take advantage of greater levels of taxation benefits. The income is not taxable to the gaming licensee and so gaming income generally comes out of the gaming licensee’s taxable profits.
Many online Australian business are not required to declare online gambling income as it is considered to be an activity carried on outside Australia.
If you think your income will be taxable in Australia you should seek professional advice.
Gaming tax benefits are available through Australian gaming tax deductions.
Gaming expenses are capital costs and the costs are deductible for tax purposes. These losses also qualify for capital gains tax rebates. The amount you can deduct for gaming expenses depends on the type of equipment you use, the length of play and whether the play constitutes a win. The following table provides a guide to the maximum gambling expense amounts.
Amount deducted on a ‘full-time average playing length’ basis (which is the most common) $4,000 per annum for a player who has played the same amount of gambling games for an average of 40 days per year
Maximum gambling expenses for the first 5 years on a ‘full-time average playing length’ basis (which applies for taxable Australian residents only), depending on total annual play, in excess of $100,000. If you make a
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