Tax on Casino Winnings

Countless Kiwis enjoy the entertainment of online gaming. As it stands, New Zealand does not have any laws or regulations in place regarding online casinos. Still, that doesn’t imply there aren’t opportunities for players to enjoy pokies and casino games. In fact, some fantastic online casinos based in other countries are happy to accept players from New Zealand.

To clarify the stance, it is not against the law in New Zealand to sign up for an account at an online casino that is located outside of the country. The vast majority of the most popular options are European-licensed casino sites that provide safe, reliable access to top games. But what about the often grey area surrounding tax on casino winnings?

Doubts About New Zealand Online Casino Taxes?

The possibility of having to pay tax on casino winnings is one thought that might make gamers wary about playing casino games online. If you’re from New Zealand and planning on gambling online for real money, you should familiarise yourself with the local tax rules. Here, you’ll find all you need to know about gambling in New Zealand legally and responsibly, so you can have fun and maybe even enjoy a profitable time in the process.

The Latest Tax Laws in New Zealand

No matter where they choose to bet, gamers have a responsibility to educate themselves on the applicable tax regulations. These rules govern both online and offline wins, so be sure to read them carefully. There is often confusion among players on whether or not they are obligated to pay taxes on any wins they may have received. We make that point clear regarding all of you Kiwis next.

Gamblers in New Zealand will be happy to hear that winnings from gaming are exempt from any and all forms of taxation. Casino gaming is regarded as a recreational activity in the nation. Hence the government does not impose any kind of tax on casino winnings from such activities. This rule applies to all forms of gambling, such as playing casino games or betting on sports or even playing poker over the internet.

But there are exceptions, and we will come to that point shortly.

The Gaming Act of 2003 is the piece of legislation that is in charge of regulating any and all forms of gambling that may be found. As long as gamblers use a site based outside of New Zealand, no local taxes will be applied to their winnings. Officially, the Income Tax Act of 2007 states that any money won through participating in any kind of causal internet gaming is exempt from taxation.

Being Aware of Tax Exceptions

The legislation, as it stands, does not require you to pay tax on casino winnings from online gaming; however, there is one exception to this rule. When playing poker online, you run the risk of being subject to various taxes. Players may be obliged to record the amount of income earned from winnings and pay taxes on those winnings too. But only if the majority of the poker money won is considered to be a primary source of income.

On the other hand, this decision is left up to the player. There is no mechanism for Inland Revenue to keep tabs on winners or have access to information on income made from gambling. This is the case in many countries, and it comes down to how your personal opinion.

The New Zealand government does not require any online casinos or gambling companies that allow players from the country to declare winnings to any governing body. The majority of gamblers will, therefore, never report winnings on their tax returns since the government considers gambling to be a recreational activity and a hobby.

If you are not a poker player who earns a living from playing the game, you won’t have to worry about paying tax on casino winnings. This also pertains to all normal and jackpot wins. So, to confirm, as long as you do not rely on the money you gain from gambling as your primary source of support, you are not obligated by any law to declare the wins you receive from gambling.

Is it Legal to Play Casino Games in New Zealand?

In New Zealand, individuals must be at least 18 years old to purchase scratch cards, engage in the lottery, wager on sports, or attend a horse race. On the other hand, individuals must be a minimum of 20 years old to enter a land-based casino in the country.

Despite the passage of the Gambling Act 2003, it is still against the law to participate in any gambling activity that is not authorised by the law. People living in New Zealand are not prohibited from using internet casinos, gambling sites, or sportsbooks that are operated by businesses headquartered in other nations. Therefore, they will not be in violation of any of the nation’s laws if they do so, which links back to the rule about not having to pay tax on casino winnings.

Instead, it is forbidden for residents of New Zealand to use any domestic online gambling network operators other than the Lottery and the TAB. People who bet in New Zealand are not directly subject to any of the country’s gambling legislation. This is because almost all of the rules are designed to police and punish the companies that manage the gaming venues rather than the gamblers themselves.

As a consequence of this, the regulations are seen as stringent, yet they do not place undue restrictions on the end-users.

Understanding the Structure of the NZ Gambling Industry

The operations of the regional regulators and monitoring bodies are likewise governed by New Zealand’s gaming legislation. At this point, it’s a good time to discover the basics about the many government departments and agencies that deal with gaming in New Zealand.

Internal Affairs Department

New Zealand’s legal gambling laws are enforced by the Department of Internal Affairs. It carries out the duties associated with gaming licences, compliance, and enforcement in strict accordance with the New Zealand Gambling Act. The Department of Internal Affairs is in charge of everything involving betting, gaming, or cash prizes.

Gambling Commission of New Zealand

The New Zealand Gambling Commission is a separate statutory authority that makes gambling-based decisions. The Commission, which was established in accordance with the Gambling Act of 2003, deals with casinos and other gambling licences granted by the Department of Internal Affairs. The NZ Gaming Commission can renew or modify current gambling licences in addition to issuing or denying casino licences. It can also provide governments advice on a variety of topics, including the Commission’s operations and performance and the gambling levy.

The Lotteries Commission & Lotto NZ

Everything pertaining to lotteries, scratch cards, keno, bingo, and similar games is handled by the New Zealand Lotteries Commission and Lotto NZ. While the process for lottery licencing is similar to that for casino licencing, it has several differences. The biggest distinction is that the government runs the biggest lotteries.

New Zealand’s Totalizator Agency Board (TAB)

The statute that created TAB is the Racing Industry Act 2020. The Totalizator Agency Board’s goals cover a wide range of topics, including collecting money, responsible gambling, and New Zealand sports. TAB NZ also addresses the dangers of problem and underage gambling.

Ministry of Health & Gambling Addiction

The Ministry of Health is in charge of enforcing gaming regulations in New Zealand. The Ministry of Health is tasked by the government with conducting gambling harm research under section 317 of the Gambling Act. As a result, there is a powerful push to avoid gambling addiction. On the website of the Ministry of Health, Kiwis can find help for gambling addiction.

Local and Unitary Councils in New Zealand

There are five territorial authorities in New Zealand that have a say in gambling-related decisions: Auckland, Gisborne, Marlborough, Nelson, and Tasman. The councils at the municipal and unitary levels serve as a liaison between the public and the executive branch. They work on the creation and evaluation of new casinos and racetracks, and they can offer proposals for improvements to the government.

Looking to the Future

It is not easy to get a complete sense of the current state of the online gaming sector in New Zealand. The same goes for getting a full grasp on paying tax on casino winnings. As a result, many people are sticking to offshore websites. People can only hypothesise about how this situation will develop over the coming years. Given the present developments in the iGaming business, it is anticipated that New Zealand’s online betting and casino market will be subject to far more stringent regulation in the future. But only time will tell.