Can I have Ltd company funds on my sports gambling account? (legit reason)

[edison]

One of the problems here is that it is totally implausible to suggest that you are running a business testing a gambling application by actually betting.

HMRC will simply assume you're gambling.

Maybe that depends? At various periods in the 1990s and 2000s, I seriously looked at becoming a professional gambler. The taxation rules have changed over the years but it's generally been moving away from the punter towards the bookmaker. HMRC publish guidance on gambling and taxation, it's essentially not a trade. See this link for a broader view and a link to the HMRC Business Income Manual (but check if it's still valid!)

Do I Have To Pay Tax On My Online Gambling Winnings? | BingoPort

As for testing, I've worked on projects to implement commercial payments systems where payments might run into the many thousands or even millions. To test it properly, we used to make actual real payments in the live system but these were nominal amounts, so called 'live penny testing.' Live testing on a betting exchange might be more tricky as liquidity starts becoming affected with larger bet sizes, depending on the market.

I worked in the gambling sector many years ago and I recall a famous test case in the 1950s where HMRC's forerunner wanted to make betting winnings taxable. The defendant was a gambler called Alex Bird who used to bet over £2m p.a (nearly £100m in today's money.) He argued that his losses should also be tax deductible. HMRC lost the case as around 98% of bets are losers which would open the floodgates for the vast number of losing punters.

[GhostofTarbera]

Maybe that depends? At various periods in the 1990s and 2000s, I seriously looked at becoming a professional gambler. The taxation rules have changed over the years but it's generally been moving away from the punter towards the bookmaker. HMRC publish guidance on gambling and taxation, it's essentially not a trade. See this link for a broader view and a link to the HMRC Business Income Manual (but check if it's still valid!)

Do I Have To Pay Tax On My Online Gambling Winnings? | BingoPort

As for testing, I've worked on projects to implement commercial payments systems where payments might run into the many thousands or even millions. To test it properly, we used to make actual real payments in the live system but these were nominal amounts, so called 'live penny testing.' Live testing on a betting exchange might be more tricky as liquidity starts becoming affected with larger bet sizes, depending on the market.

I worked in the gambling sector many years ago and I recall a famous test case in the 1950s where HMRC's forerunner wanted to make betting winnings taxable. The defendant was a gambler called Alex Bird who used to bet over £2m p.a (nearly £100m in today's money.) He argued that his losses should also be tax deductible. HMRC lost the case as around 98% of bets are losers which would open the floodgates for the vast number of losing punters.

Penny testing works fine for FPS etc, not good on Betfair where minimum is £2, and if covering several positions with multiple values above £2 it could be £100 in a few seconds on minimum stakes


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[jayn200]

Maybe that depends? At various periods in the 1990s and 2000s, I seriously looked at becoming a professional gambler. The taxation rules have changed over the years but it's generally been moving away from the punter towards the bookmaker. HMRC publish guidance on gambling and taxation, it's essentially not a trade. See this link for a broader view and a link to the HMRC Business Income Manual (but check if it's still valid!)

Do I Have To Pay Tax On My Online Gambling Winnings? | BingoPort

As for testing, I've worked on projects to implement commercial payments systems where payments might run into the many thousands or even millions. To test it properly, we used to make actual real payments in the live system but these were nominal amounts, so called 'live penny testing.' Live testing on a betting exchange might be more tricky as liquidity starts becoming affected with larger bet sizes, depending on the market.

I worked in the gambling sector many years ago and I recall a famous test case in the 1950s where HMRC's forerunner wanted to make betting winnings taxable. The defendant was a gambler called Alex Bird who used to bet over £2m p.a (nearly £100m in today's money.) He argued that his losses should also be tax deductible. HMRC lost the case as around 98% of bets are losers which would open the floodgates for the vast number of losing punters.

98% of bets are not losers... But yes all gambling has a house edge so if you take the entire pool of gamblers Hmrc would come out owing money.

Tax the house though since they always win and Hmrc makes a killing.

Makes no sense to tax gamblers but they do it in the USA! They get around it by only allowed gambling losses to be deducted from gambling income and not from regular personal income. It's messed up and shouldn't be legal but it is what it is.

[edison]

98% of bets are not losers... But yes all gambling has a house edge so if you take the entire pool of gamblers Hmrc would come out owing money.

Tax the house though since they always win and Hmrc makes a killing.

Makes no sense to tax gamblers but they do it in the USA! They get around it by only allowed gambling losses to be deducted from gambling income and not from regular personal income. It's messed up and shouldn't be legal but it is what it is.

I meant 98% of people lose money long term on betting and I was referring mainly to horse racing but it applies in other areas like financial spread betting too. Contracts for Difference (CFD) bettors lose over 80% of the time. One of the main reasons most punters lose money is because they bet on multiple like doubles, trebles, accumulators, 'Lucky 15' etc. This is the biggest profit margin for bookmakers and conversely, most serious punters used to bet only on singles.

Also, certain high profile sports tend to be the ones that are most difficult to make long term returns. Horse racing is one, there's hardly any winning edge available to punters. Football has been going the same way. One of the reasons is that because of the wealth of data, bookmakers make few pricing errors that bettors can exploit. Compare that with minor sports like say athletics where a person making the book (creating the odds) may not be an expert and there is ore scope to find value prices.

I don't know what the figure is today, but in the 1980s and 90s, the 'over round' i.e. the percentage edge UK bookmakers had on horse racing was around typically around low teens up to about 17%. It's extremely difficult to win long term on horse racing although betting tax treatment of bets have changed over the years.

The large majority of long term winning punters on exchanges like Betfair are layers not bettors. I believe the figure there is still in the 90+ percent range.

[edison]

Penny testing works fine for FPS etc, not good on Betfair where minimum is £2, and if covering several positions with multiple values above £2 it could be £100 in a few seconds on minimum stakes


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That's partly what I was trying to articulate but not very well...

[d000hg]

It's clear from the OP's question that this isn't the case. Any further comments on these lines will be removed.

FWIW I didn't read the original comment as "are you wanting to gamble company money". I read it as "do you gamble with your own money and want to use the same account to legitimately test the app".

[LondonManc]

If the app wins big and you make a 10k profit, at least if it's your personal cash you don't have to worry about paying tax on it. Just a thought.

[GregRickshaw]

Can't add anything useful to the tax opinions and company funds etc., But would be dead keen on seeing the app