Do you need to submit your gambling/sports betting winnings to SARS?

[elown]

I, as a hobby and sort of a second income, bet in sports pretty regularly. Because I have a system, I bet in a disciplined way and follow lots of sports, I make good amount of profit from betting. Obviously, sometimes I lose big, sometimes I win big. Overall, I always keep track of my profit situation and my profit this year is pretty serious compare to my salary(About half of my salary). I have been doing this for years, but this last year has been the most profitable, by far.

So, the question is, what is the tax situation here? A few years ago, I spoke to an accountant and asked this question, and she said that because gambling winnings are not taxed in SA(unless you're a professional gambler) and also it's not like I keep winning, I lose some, and win some. She said it's not necessary to declare that to SARS when it's e-filing time. That year, I didn't declare anything about my sports betting winnings and nothing happened.

Last year, I used Taxtim for e-filing and they actually suggested declaring them, and I did. No problem at all again.

The reason why I'm questioning this now is that the amount this time is much much higher. If I declare my sports betting winnings, SARS might ask for documents and that will be a hell to go through as I use a few different betting websites and there are so many deposits/withdrawals. The questions here are:

1. Would SARS come after me if I don't mention my gambling winnings in e-filing?
2. Would they ask me for more documents if I declare my gambling winnings in e-filing?
3. If I need to declare, do I declare the amount of profit I made or the total amount of withdrawals? (It will be a big difference in number)

I know that the gambling winnings are not taxable and I'm not in trouble or anything, but I just don't want to go through a year of deposits/withdrawals, get all the documents, calculate the amounts, etc. Just trying to make it as convenient as possible without getting much involved with SARS.

So, long story short, is it necessary mention gambling winnings as "other income" during e-filing?

 

[dreamer555]

@elown Gambling profits are non taxable.

Just don't make it your career, if you do, they will come after you.

 

[elown]

@dreamer555 As long as I declare my employment documents, even if I'm making close to my salary, they wouldn't bother, do they? In which case, is it worth declaring the profits still as a non-taxable income or not bother?

 

[sickofallthelies]

@elown Don't bother. The less they know, the less they have to ruin your life with has always been my motto.

 

[andujartyler]

@sickofallthelies This comment is an excellent example of why you shouldn't ask for this kind of advice from random strangers on an internet forum. If you want confirmation of what you hope the answer will be, go ahead. If you want an actual factual answer, talk to a professional.

 

[sickofallthelies]

@andujartyler If you declare gaming winnings, you probably pay etolls also....

 

[ethan46]

@elown I think the logic is that if winnings can be taxed, losses can be used to reduce your tax liability, which SARS dont want. You're more likely to lose than win, so it's not in their best interest. The betting company will need to pay tax on their profits though.

 

[elown]

@ethan46 So, no need to declare or still declare under non-taxable income? Or doesn't really matter?

 

[andujartyler]

@elown Ask a professional, not random strangers

 

[alfiano]

@elown You’re in a grey area between professional gambler and not. I’d suggest seeking advice and getting a formal opinion from a tax consultant. You don’t want SARS chasing you further down the line.

 

[rayne49]

@elown "I have a system"

 

[kedgre]

@elown No , it’s not income as defined in the Income Tax Act

 

[elown]

@kedgre So, it's fine to not to declare non-taxable income during e-filing even though there is a "Other" section?

 

[kedgre]

@elown Yes - as it is not income

 

[flinger]

@kedgre If its not income, then it must be capital hence why it is not taxed. Basically if you apply the revenue vs capital principles there is a good chance that the consistent attempt to win in sports betting is actually, income in nature.

Its a fine line, but SARS will be seeing deposits and withdrawls of his bank account anyway, so at some point they may ask to explain.

Always better to declare than not, some years you win and others you loose.

 

[47ford]

@elown Because you’re running it as a income generating concern, your profits are taxable.
If they ever do a 5 year audit on you, you might be in trouble.
Footnote: You will eventually loose all your money. Guaranteed

 

[elown]

@47ford What do you mean by running it as an income generating concern? I mean they can see I’m full time employed and pay my income tax and this is a side thing. I’m not sure I understand how this makes my profits taxable. Afaik, professional gambler means someone who does this for a living as the main income, which is not my case. Overall, do you suggest declaring my profit as non-taxable income?

 

[47ford]

You obviously don’t know our tax laws. INCOME GENERATING CONCERN. Its the same thing as a plumber fixing car engines over weekends to supplement his INCOME. Taxable.
I suggest you contact a tax practitioner

 

[ash_ley4]

@elown I've considered betting on the side a bit. I play poker and card games on the side, but wanted to know where do you bet at and how reliable are they?

Also, well done on making a chunk of money on the side

 

[elown]

@ash_ley4 Thank you. I only do sports betting. No idea about poker, card games, etc. casino stuff. I use Betway, Betolimp and Sportingbet mainly (Some other on the side as well, but mainly these three). If you start winning big though, Betway immediately limits your bets. So, I don't really recommend them, but again, don't know how things work with the casino stuff.