Taxing Crash winnings
1) Short answer
Recreational players. Betting/gaming wins (including Crash) are not included in taxable income and losses are not deductible. This is the ATO's position: "betting and gambling wins are not assessable... unless you are carrying on a business of betting or gambling».
Professional activities. If the ATO determines that you are actually running a betting/gaming business, the profit is taxed as ordinary income, and the associated costs/losses become deductible. Criteria - from Brajkovich/Evans/Babka practice and clarification IT 2655.
Crypto aspects. If the win is a crypto asset, a CGT event is triggered during the subsequent sale/exchange; the value of the acquisition is the market at the time of winning. Payment for services/deposits by crypt also generates a CGT event (usually not a "personal use asset").
2) When Crash winnings are not taxed
You don't run a gambling business.
Your winnings are not by nature "ordinary income" and are not subject to special rules about "statutory income." The ATO directly confirms this in numerous explanations and private decisions (edited private rulings).
Consequences:
3) When the ATO can recognize a business and impose income
The ATO looks at a combination of factors (Brajkovich, Evans, Babka case totals and position in IT 2655):
If the business is established: profits are taxed under § 6-5 of ITAA 1997; losses/expenses - according to § 8-1 (with the test of connection with income).
4) Losses, deductions and "symmetry"
Recreational mode: losses and expenses are not deductible (as well as winnings are not taxed).
Business regime: deductions for expenses/losses are allowed if they are incurred to generate taxable income.
5) Cryptocurrency: Three typical situations
A) You won a crypto asset (token/coin/NFT)
In a subsequent sale/exchange, CGT occurs; cost base - market value at the time of winning.
B) You pay with crypto (deposit/payment for services)
A transfer of a crypto asset for payment is considered to be a realization → a CGT event on the date of transfer; most cases do not fall under "personal use asset."
C) "Personal use asset" (rarely applicable to crypto)
CGT can only be ignored if the asset is truly personal consumption and was worth <10,000 AUD; ATO emphasizes that in most cases crypto is an investment, not "personal use."
6) Foreign sites and origin of funds
The fact that the site is offshore/unlicensed at AU does not change the tax qualifications of the winnings: the principle is the same - either recreation (no tax) or business (with tax). The ATO repeatedly confirms that the winning location does not make it taxable on its own.
Records and evidence. ATO draws attention to "origin of funds"; keep statements, deposit/withdrawal history and transaction screenshots - this helps explain large enrolments. (See explanations and ATO community cases.)
7) What is always declared, even if Crash wins are not taxed
Interest/income from the placement of money won (on an account/deposit/crypto-staking) is a separate taxable income.
CGT in the subsequent sale of crypto assets received as a gain - according to the general rules (see § 5A).
8) Practical checklists
"Recreational Player"
1. Keep a history of deposits/withdrawals, checks and bank/payment statements.
2. Do not claim loss/expense deductions.
3. If you received crypto prizes, fix the market value on the winning date (for the future CGT).
4. Interest/investment income on funds won - declare.
"Is there a risk of recognition of the business?"
Tick the Brajkovich/Evans/Babka criteria: scale, consistency, connection with other commerce, regularity of profit, "level of skill," accounting and planning. With a lot of "yes" - talk to the accountant about the business mode.
9) Important nuances and frequent questions (AU)
Do I have to pay tax on a win in Crash?
Usually not unless you run a gambling business.
If the ATO deems me "professional," what changes?
Profits are taxed as ordinary income; related costs and losses can be accounted for; it all depends on the facts (see IT 2655).
Won in the crypt - taxes?
The win itself from a recreational player is not taxed; but on sale/exchange, the crypto prize will be CGT, with a base equal to the market price at the time of winning.
Deposited/replenished with crypto - taxes?
Crypt transfer for payment is an implementation and possible CGT; "personal use asset" is rarely used.
And if "banks/ATO" ask about large enrollments?
Keep documents: game/conclusion history, bank statements, screenshots. ATO Community confirms: the winnings of recreational players are not taxed, but the origin of the funds must be able to show.
10) AU Context and Operational Highlights
At the tax policy level, players are generally not taxed; the tax burden falls on operators (different taxes and/or GST rules for operators' business), which is regularly emphasized by professional publications. This does not create taxes on the recreational player.
The legal status of Crash in AU (prohibition of offering online casinos) is a matter of regulation, not taxation; the tax regime of winnings is described above and does not itself legalize offshore play. (See the piece on legality in this series.)
11) The bottom line
1. For most players, Crash wins are not taxed and losses are not deducted.
2. Tax is possible if the ATO considers that you are actually running a gambling business (Brajkovich/Evans/Babka criteria; IT 2655).
3. Crypto prizes and crypto payments drag on CGT events: fix the market value and keep records.
4. Keep documents on the origin of funds - this is the main protection in ATO matters.
[couriermail. com. au](https: //www. couriermail. com. au/news/queensland/high-stakes-gambler-ti-ke-tran-aka-lucky-eddie-or-eddie-the-blessed-faces-multimilliondollar-tax-bill/news-story/0189faa3a437e555bfd47abaf61fa2fb? utm_source=chatgpt. com)
Recreational players. Betting/gaming wins (including Crash) are not included in taxable income and losses are not deductible. This is the ATO's position: "betting and gambling wins are not assessable... unless you are carrying on a business of betting or gambling».
Professional activities. If the ATO determines that you are actually running a betting/gaming business, the profit is taxed as ordinary income, and the associated costs/losses become deductible. Criteria - from Brajkovich/Evans/Babka practice and clarification IT 2655.
Crypto aspects. If the win is a crypto asset, a CGT event is triggered during the subsequent sale/exchange; the value of the acquisition is the market at the time of winning. Payment for services/deposits by crypt also generates a CGT event (usually not a "personal use asset").
2) When Crash winnings are not taxed
You don't run a gambling business.
Your winnings are not by nature "ordinary income" and are not subject to special rules about "statutory income." The ATO directly confirms this in numerous explanations and private decisions (edited private rulings).
Consequences:
- Do not declare winnings;
- Do not write off losses/expenses (commissions, subscriptions to "types," etc.).
3) When the ATO can recognize a business and impose income
The ATO looks at a combination of factors (Brajkovich, Evans, Babka case totals and position in IT 2655):
- consistency, organization and "business" nature of actions;
- Scale (betting/winning/turnover)
- connection with other business activities;
- presence/level of skill versus "pure chance";
- sustainability and regularity of profits;
- keeping records, plans, "bankrupt" "business-like."
💡The characteristic thesis of IT 2655: "there is not a single case where the winnings of an ordinary player are recognized as taxable"; business recognition is rare and always fact-dependent.
If the business is established: profits are taxed under § 6-5 of ITAA 1997; losses/expenses - according to § 8-1 (with the test of connection with income).
4) Losses, deductions and "symmetry"
Recreational mode: losses and expenses are not deductible (as well as winnings are not taxed).
Business regime: deductions for expenses/losses are allowed if they are incurred to generate taxable income.
5) Cryptocurrency: Three typical situations
A) You won a crypto asset (token/coin/NFT)
In a subsequent sale/exchange, CGT occurs; cost base - market value at the time of winning.
B) You pay with crypto (deposit/payment for services)
A transfer of a crypto asset for payment is considered to be a realization → a CGT event on the date of transfer; most cases do not fall under "personal use asset."
C) "Personal use asset" (rarely applicable to crypto)
CGT can only be ignored if the asset is truly personal consumption and was worth <10,000 AUD; ATO emphasizes that in most cases crypto is an investment, not "personal use."
6) Foreign sites and origin of funds
The fact that the site is offshore/unlicensed at AU does not change the tax qualifications of the winnings: the principle is the same - either recreation (no tax) or business (with tax). The ATO repeatedly confirms that the winning location does not make it taxable on its own.
Records and evidence. ATO draws attention to "origin of funds"; keep statements, deposit/withdrawal history and transaction screenshots - this helps explain large enrolments. (See explanations and ATO community cases.)
7) What is always declared, even if Crash wins are not taxed
Interest/income from the placement of money won (on an account/deposit/crypto-staking) is a separate taxable income.
CGT in the subsequent sale of crypto assets received as a gain - according to the general rules (see § 5A).
8) Practical checklists
"Recreational Player"
1. Keep a history of deposits/withdrawals, checks and bank/payment statements.
2. Do not claim loss/expense deductions.
3. If you received crypto prizes, fix the market value on the winning date (for the future CGT).
4. Interest/investment income on funds won - declare.
"Is there a risk of recognition of the business?"
Tick the Brajkovich/Evans/Babka criteria: scale, consistency, connection with other commerce, regularity of profit, "level of skill," accounting and planning. With a lot of "yes" - talk to the accountant about the business mode.
9) Important nuances and frequent questions (AU)
Do I have to pay tax on a win in Crash?
Usually not unless you run a gambling business.
If the ATO deems me "professional," what changes?
Profits are taxed as ordinary income; related costs and losses can be accounted for; it all depends on the facts (see IT 2655).
Won in the crypt - taxes?
The win itself from a recreational player is not taxed; but on sale/exchange, the crypto prize will be CGT, with a base equal to the market price at the time of winning.
Deposited/replenished with crypto - taxes?
Crypt transfer for payment is an implementation and possible CGT; "personal use asset" is rarely used.
And if "banks/ATO" ask about large enrollments?
Keep documents: game/conclusion history, bank statements, screenshots. ATO Community confirms: the winnings of recreational players are not taxed, but the origin of the funds must be able to show.
10) AU Context and Operational Highlights
At the tax policy level, players are generally not taxed; the tax burden falls on operators (different taxes and/or GST rules for operators' business), which is regularly emphasized by professional publications. This does not create taxes on the recreational player.
The legal status of Crash in AU (prohibition of offering online casinos) is a matter of regulation, not taxation; the tax regime of winnings is described above and does not itself legalize offshore play. (See the piece on legality in this series.)
11) The bottom line
1. For most players, Crash wins are not taxed and losses are not deducted.
2. Tax is possible if the ATO considers that you are actually running a gambling business (Brajkovich/Evans/Babka criteria; IT 2655).
3. Crypto prizes and crypto payments drag on CGT events: fix the market value and keep records.
4. Keep documents on the origin of funds - this is the main protection in ATO matters.
💡The material is for informational purposes only and is not tax advice. For a personal assessment, contact your Australian tax adviser.
[couriermail. com. au](https: //www. couriermail. com. au/news/queensland/high-stakes-gambler-ti-ke-tran-aka-lucky-eddie-or-eddie-the-blessed-faces-multimilliondollar-tax-bill/news-story/0189faa3a437e555bfd47abaf61fa2fb? utm_source=chatgpt. com)
