Question 3. What percentage of the prize must be paid towards taxes?? Is there a relationship between the amount of winnings and the tax fee??
Answer: Let's clearly answer this question:
- in Italy prizes over 500 euros have tax 6 percent;
- in Spain the winnings are more 2500 euro has a tax charge of 20 percent;
- Switzerland has established a tax on any prize 35 percent;
- in Bulgaria the winnings are higher 400 euros have tax 10 percent;
- Czech Republic for prizes, exceeding 400 euro, requires payment of tax in the amount 20 percent of the prize amount;
- in Israel for winnings over 50 thousand shekels there is a tax fee of 30 percent;
- Portugal demands payment 20 percent of the winnings, if your prize is greater 5 thousand euros;
It should also be noted that there are differences in taxation between different states in America, taking into account prizes over 600 dollars:
- New Jersey - 35, 8 percent;
- Michigan — 29,5;
- Texas, New Hampshire, California, South Dakota, Tennessee, Washington, Nevada – 25 percent;
- NY - 37,7;
- Illinois – 28.
Pitfalls of taxing players in Russia
- How will the transfer of chips between players be controlled?. Obviously, that “home gambling addicts” with minus bankrolls should appear in casinos, ready to exchange chips for money, to avoid paying 13% tax. In this regard, “deferred” taxation of players in Russia (in comparison with Belarus, where the tax is withheld immediately at the casino cash desk) looks more tailored to the players, but not under the state.
- Will Russian tax authorities transfer information about players to tax authorities in other countries?? It is beneficial for players to travel to Sochi from abroad, since the casino (game organizer) does not withhold tax at the cash register. But will the tax authorities pass on information about winning players with or without a request?? The question is open.
State taxes
In addition to federal taxes, your Powerball winnings may also be subject to local taxes
Important to remember, what's the tax, charged to your prize, depends not only on the state, but also on your individual circumstances
The following table shows the withholding rate for each participating jurisdiction, and also the threshold value, When do prizes begin to be taxed at the state level?.
| State income tax | Jurisdiction |
|---|---|
| No state tax on winnings | California, Florida, New Hampshire, Pennsylvania, Puerto Rico, South Dakota, Tennessee, Texas, US Virgin Islands, Washington State, Wyoming |
| 2.9% | North Dakota |
| 3% | New Jersey |
| 3.07% | Pennsylvania |
| 3.4% | Indiana |
| 3.75% | Illinois |
| 4% | Colorado, Missouri, Ohio, Oklahoma, Virginia |
| 4.25% | Michigan |
| 5% | Arizona, Iowa, Kansas, Louisiana, Maine, Massachusetts, Nebraska |
| 5.75% | North Carolina |
| 5.99% | Rhode Island |
| 6% | Georgia, Kentucky, New Mexico, Vermont |
| 6.5% | West Virginia |
| 6.6% | Delaware |
| 6.9% | Montana |
| 6.99% | Connecticut |
| 7% | Arkansas, South Carolina |
| 7.25% | Minnesota |
| 7.4% | Idaho |
| 7.75% | Wisconsin |
| 8% | Oregon |
| 8.5% | Washington |
| 8.75% | Maryland |
| 8.82% | NY |
Playing international lotteries
If you are playing an international lottery online, to you, Maybe, will have to pay taxes. If you are using a concierge service (or messenger service), who buys tickets on your behalf, you will pay tax depending on where you purchased the ticket. If you win the lottery in the country, in which lottery winnings are taxed, and live in the country, in which a percentage of winnings is also retained, usually, you will have to pay the tax once, given that, that the countries have concluded an agreement to avoid double taxation. You should consult with a financial professional, do you fall under these conditions.
If you are using a betting service and betting on the results of a drawing, instead of buying a ticket, The rules of your country of residence apply.
Medieval history
First registered lotteries, offering tickets for sale with cash prizes, were held in the Netherlands in 15 century. Public lotteries were held in different cities, to raise money for city fortifications and help the poor. City records of Ghent , Utrecht and Bruges indicate that, that lotteries could be even older. Posted by 9 May 1445 year in L’Ecluse concerns raising funds for the construction of walls and city fortifications with a raffle 4 304 tickets and total prize fund 1737 florin (worth about 170 000 US dollars to 2014 year). IN 17 century in the Netherlands it was common to organize lotteries to raise money for the poor or to raise funds for all kinds of public needs. Lotteries proved to be very popular and were considered a painless form of taxation . State Dutch State lottery Staatsloterij - the oldest lottery. The English word "lottery" comes from the Dutch noun "lot", meaning "fate".
The first recorded Italian lottery was held 9 January 1449 year in Milan, organized by the Golden Ambrosian Republic to finance the war against the Venetian Republic . Nevertheless, it was in Genoa , What the lotto became very popular. People used to bet on the names of the members of the Grand Council, which were chosen randomly , five out of ninety candidates every six months. This type of gambling was called Lotto or Semenaia . When people wanted to bet more often, than twice a year, they started replacing candidates' names with numbers, and modern lotto was born, according to which, like modern legal lotteries, and illegal numbers games can trace their origins.
Zero tax on winnings in Germany, in Malta and Finland
Among the list of countries with legalized gambling business, there are the following:, in which zero tax on winnings is approved. It means, that the player receives payment in full, and he does not need to give a percentage of it to the state. One of these countries is Germany, where more than 70 land-based casinos are located and there is no taxation of winnings.
In Malta there is also no taxation of winnings from online casinos, but casino operators are not so lucky: To operate legally they must pay a license fee – 46 000 euro and 15-40% from this amount to gross turnover. Gaming activities in Malta are managed by the government's Lotteries and Gaming Commission.
In Finland, players also do not have to pay taxes on winnings from online and land-based casinos. But gambling operators must be paid annually 8.25% from net profit. There is a popular place on the territory of the state – Casino Helsinki – proceeds from his work go to charity.
World lotteries All about taxation of lottery winnings
You do not have to pay tax on prizes up to 600 dollars, but you must report your winnings to the Internal Revenue Service (IRS), if you win an amount from 600,01 to 5000 dollars. You will be given a W-2G form to complete your tax returns.. Federal tax in the amount 24% will be charged on all prizes over 5000 dollars (including jackpot) before, how will you receive your prize money. You may then be eligible for a refund or pay even more taxes when you file your return., depending on your total income. If you win the jackpot, you will be subject to a maximum federal tax rate of 37%. Players, who are not US citizens, are subject to federal tax in the amount of 30%, but not 24%. Playing the lottery refers to gambling in part, relating to the Internal Revenue Service (IRS), what does it mean, that you are entitled to a tax deduction for any losses incurred.
To file these deductions, you will need to keep accurate records of your winnings and losses, as well as any evidence of them, such as tickets, which you bought. You must report deductions on your tax form. 1040, which can be obtained from the IRS website.
How much will you have to pay in foreign lotteries?
More and more people have recently given preference to foreign games., which offers many modern services for the game, similar to Ventura24 or Lotto247. Players are offered a wide range of world-famous lotteries with more than tempting Jackpots. But won't we have to give most of the winnings to the state?, therefore, more and more players are interested in what the tax is on a foreign lottery?
Before you choose the lottery you like, pay close attention to the country of its origin, a lot depends on this, since each country has its own tax rate.
European lotteries
EuroMillions Lottery and EuroJackpot, which are common in many European countries and the tax rate depends on the country, V which ticket was purchased. Add the tax of your home state to the tax rate of each specific country.
But some countries, such as Germany, Finland, Australia or England have completely abolished the tax levy on lottery winnings, therefore you will have to pay only according to the law of your country. And Russia has an agreement with Spain, abolishing double taxation. Points like these are worth exploring., to avoid getting into trouble or choose the right gaming operator, similar to Lotolion, so that you don’t have to rack your brains and look for the necessary information on websites.
When participating in the Italian lottery, be prepared to pay 6% account, V Czech lottery – 20% and for winning in the Bulgarian lottery they will charge you 10%.
American lotteries
Amounts up to 600 dollars are paid to the winners without deductions. Larger amounts are subject to tax.
Highest percentage in the US - up to 45 % depending on the state.
This rate applies in the case, if the winner wishes to take the entire prize in cash for 1 payment. But if you choose “installment payment of winnings”, which is called Annunity below, then the deduction amount will be approximately 25%.
To summarize, we can say - no matter what lottery you play in the free Socialchanse or the popular La Primitiva, you will still have to pay taxes. But the main thing to remember, What, winning the Jackpot or prizes that are slightly less significant, the profit is much greater, than tax on lottery winnings, many victories to you
Taxation in Bulgaria: ban on private lotteries
In Bulgaria, tax obligations are imposed exclusively on gambling organizers. The current tax rate is 15%. The figure is the same for the mobile gambling market. The license maintenance fee reaches 20% by GGR. Tax amounts for specific types of activities are also determined.:
- 500 BGN per quarter – for slot machines in the corresponding halls;
- 22 000 levs per quarter for each gaming table – for roulettes;
- 5000 BGN for each unit – for any other gaming equipment in the casino.
According to the article 242 (2) OTHER, activity, related to slot machines and online casinos, subject to corporation tax, which is also paid quarterly. Despite fairly strict regulatory conditions and a precarious economic situation, Gambling in Bulgaria still works and brings results.
Only proven foreign lotteries online! Become a winner of popular games! →
Also, according to the latest data, due to underpayment of taxes by private lotteries in the amount of $118 million over the past six years, a bill has been developed to ban private lottery operators. Probably, publicity of such a fact is a demonstration of one of the reasons, on which legislators make their decisions. In this case, fairly stringent regulatory measures followed in response to a gross violation on the part of the operator.
Question 8. Are there any hidden taxes??
Answer: Available. When you play a game online, then the intermediary has the right to charge a fee for a winning lottery ticket as a commission for services. This is agreed upon in advance, information is indicated on the site pages.
Don't be afraid of numbers, in which tax fees are indicated. Firstly, taxes paid from prizes will go to good government causes. As a result, life after winning may change not only for you, but also those people, who these taxes will help. Secondly, foreign lotteries offer such large prizes, that taxes should be the least of your worries if you win. The main question is where to spend such a lot of money? But it's more rhetorical.
Be vigilant and law-abiding! And may luck smile on you!
| The lottery | Name | Maximum Jackpot |
|---|---|---|
| Uk National Lottery | EUR167 million | |
| Mega Millions lottery | $656 million | |
| Euromillions lottery | GBP 167 million | |
| Powerball lottery | $1.6 Billions | |
| Euro Jackpot lottery | 90 million EUR |
What are the alternatives to the American Powerball and Mega Millions lotteries for foreigners??
For those foreigners, who are looking for an alternative to the American lotteries Powerball and Mega Millins, which use similar lottery style games, there are several options. We will explore these potential replacements foreign lottery players, Let's evaluate options for alternative international lotteries, offers of regional lotteries and digital gaming services, available on the Internet.
International lotteries for foreigners.
International lotteries provide an opportunity for foreigners from other countries to participate in various lottery games and give them a chance to win big prizes. International lotteries are often the result of coordination between several countries and offer much larger prizes, than regional lotteries, available locally. Participation in international lotteries, such as EuroMillions or EuroJackpot from Europe, could allow foreigners to win huge prizes, almost as big, like prizes, offered by American lotteries Powerball или Mega Millions, without having to deal with many complications, related to playing American lotteries. For example, Foreigners do not have to pay tax on European lottery winnings, as all winnings from the EuroMillions lottery or EuroJackpot lottery are offered tax free to all lottery players, including foreigners, living abroad.
Regional lotteries for foreign lottery players.
Playing Regional Lotteries May Be More Achievable for Non-Resident Foreigners, depending on their location and local regulations. These regional lotteries are often organized by individual countries and usually offer much smaller rewards, than international lotteries, however, foreigners are more likely to win these lottery prizes. Foreigners, participating in these alternative regional lotteries, can still experience the thrill and anticipation, similar topics, that occur when playing large international lotteries or American multi-state lotteries, such as Powerball or Mega Millions. As mentioned above, in small regional lotteries it is usually much easier for foreigners to win, as they offer much better chances of winning top prizes compared to major international lotteries!
What alternative online gaming platforms can foreigners play on??
For those foreigners, who are not from the United States, but still want to experience the thrill of gambling, Foreigners can try their luck at lottery-style games on many online gaming platforms, which provide many alternatives. These alternative platforms make it easy for foreigners to play different games with different potential prizes from your country of origin, and all this without participating in any American lottery. Thus, foreigners can choose that game, which suits them best, based on their own preferences and risk appetite. Virtual gaming sites allow individuals and foreigners from all over the world to have an exciting gambling experience, which is just as fascinating, just like playing traditional American lotteries, such as Powerball or MegaMillions!
How are winnings taxed in the US?
The United States of America has its own taxation specifics. The thing is, that online casinos operate illegally here and more attention is paid to sports betting. Tax on winnings in the US depends on, Is the player an American citizen?, and if so, then he pays 35%.
US citizens are also required to pay taxes on online quick wins at the state level., where do they live. Eg, In Pennsylvania, the tax rate for residents is 30%, and in Nevada it is completely absent. Foreigners in the US often have difficulty paying double fees. To avoid this, the player needs to inform the casino owners, What country is he a citizen of?.
According to statistics, The largest jackpots are played in the USA. Most lotteries offer an immediate payout of 60-70%, or the amount was paid gradually over 20-30 years. The following jackpots have become the most famous in recent years::
- 24 August 2017 year, the Powerball lottery brought the jackpot to an American woman $758,7 million – this is one of the largest prizes in history. The woman decided to take the winnings immediately, therefore the final payment amount was $443,3 million.
- January 2016 year became significant for three Americans, who played the same Powerball lottery, where was the jackpot played? $1.5 billion. The winners decided to receive the winning amount immediately, and not in parts over 30 years. Thus, each of them received $327, 8 millions.
- Colombian emigrant Juan Rodriguez also won the lottery. Working as a parking lot security guard, he earned minimum wage and had great financial difficulties. After buying a lottery ticket, great luck overtook him - $149 million in the Mega Millions lottery. Also, like the previous lucky ones, Rodriguez took the winnings immediately, and she made up $88,5 millions.
- Andrew Jackson Whittaker, resident of West Virginia, V 2002 received $315 million. Andrew was a successful businessman and owned his own construction business, so I was very surprised by such a pleasant surprise. The winner chose to receive the amount immediately, and after paying duties and fees, I took approximately $111 million.
- 9 May 2002 two US residents were lucky to win $360 million in the Big Game lottery. Both men wanted to receive the payment instantly, and after deducting all taxes they got $90 million. One of them – Larry Ross – gave an interview, in which he told, that I have never participated in such events before, and the ticket was given to him by the hot dog seller as change from $100.
