Tuesday, 27 October 2009

Going full-time in the UK

The UK is one of the best places to go pro - you are not taxed on your winnings at all :) In the US you have to pay tax, but can write off losses, whereas in Brazil you have to pay tax on every win you have, but can't offset your losses against it - no wonder there aren't many online players from Brazil!

I was worried that this might change in the future for the UK, but it would also mean the Inland Revenue would have to accept gambling losses as tax-deductable so I don't expect it will change as they'd have a mountain of paperwork for probably no gain and potentially be opening up an exploitable loophole.

As a poker player, I'll be classed as "non-employed". This means I'll also be able to stop paying tax on any interest on my savings which is an added bonus. One thing I'll need to keep an eye on is National Insurance contributions - it looks like I can let it lapse for a while but will need to do something before the price goes up 2 years later : http://www.hmrc.gov.uk/nic/ca5603.pdf

2 days left at work now!


Bazclef said...

As far as I can see there's virtually no point in considering paying voluntary NI until you've been out of work for like 5 years.

microstakes bankroll builder said...

class 2 NI is £130ish per year and covers you completely. You just need to register. even 5 years can make quite a difference.

i would suggest you do class 2, by registering as self employed, and just pay the tax on your savings

your poker winnings do not count toward your self employed income, so class 2 basic is all you ever pay

Bazclef said...

Meh, I can't see much of a point in paying it tbh.

So long as you reach the threshold amount of years to accrue a state pension then I don't think it's worth it.

No idea why you'd want to pay this and pay tax on savings. Please enlighten me MBB :)

I've not paid any NI since the start of the year, my savings accounts are tax free and I have a personal pension plan.

P.S. Sorry for the semi-hijack Ed, but I'm guessing any discussion will be beneficial to yourself also!

anomaly16 said...

yeah the discussion is interesting :)

For me its all about minimizing costs and maximizing income so I'll definitley be passing on the NI and tax for now.

I'll probably re-evaluate in a year or so.

havin_a_laff said...

HMRC used to have a very good helpline. you can call anonymously! for peace of mind you could call and get some advice. would be interesting to know what they say.

This is the number of NIC

0845 302 1479

microstakes bankroll builder said...

baz, anom
its cool if poker is your sole income for the next 5 or more years, but i doubt very much that anyone can gaurantee that.
if you have other forms of income, you need to start declaring, which can affect the tax free savings stuff.
i would just not be having lots of cash in uk banks, tax or no tax, its not the most efficent use of your capital by a long way, and i dont see that changing in the next few years
but notwithstanding, why have savings in todays uk climnate, bank deals are horrible, you surely would be investing the money as capital is king right now, so your money should be working for you.
and if your not paying tax, your private pension is pretty much the same as any savings account, so not sure why you would mention that. cant claim tax back when your not paying it.
but finally, the long term benefits of the small amount yearly to remain on the radar for other benefits that NI offers, well it just outwieighs not paying it.

adavies said...

Technically, you're unemployed and are eligible for benefits. You've paid NI and, like any insurance, are entitled to claim on it.

Your poker bankroll will count towards your savings.