Guide to Lottery Taxes | theLotter
 
 
 

All About Lottery Taxes

Tax-Free Lottery Games Around the Globe

Lottery prizes from Australia, Canada, France, Hungary, Ireland, New Zealand, South Africa, and the UK are paid out tax-free. While there is no taxation at the source, you may be subject to local taxation, based on your country of residence – always check with a tax professional if you come into a large sum of money.

Below is the full list of tax-free games we offer on theLotter.

Australia Monday Lotto
Australia Oz Lotto
Australia Powerball
Australia Saturday Lotto
Australia Wednesday Lotto
Austria Lotto
Austria EuroMillions
Brazil Dupla-Sena*
Brazil Mega-Sena*
Brazil Quina*
Canada Lotto 6/49
EuroJackpot** (tickets purchased in Spain)
Finland Lotto
Finland Viking Lotto
France EuroMillions
France Loto
Germany Lotto
Hungary Hatoslotto
Hungary Otoslotto
Ireland Lotto
New Zealand Powerball
Ontario 49
South Africa Lotto
South Africa Powerball
Spain EuroMillions**
UK EuroMillions
UK Lotto
UK Thunderball

* Brazil withholds taxes, but they are deducted prior to publishing the jackpot amount. The jackpot amount you see online is therefore the total amount after taxes so no further deductions will be taken.
** Citizens of most countries other than Spain are entitled to a full tax refund in order to prevent double taxation.

Lottery Taxes Explained

Lottery taxes, like all taxes, are decided by the local/federal government where the ticket is physically purchased. Let's take a closer look at the different types of taxes a player will encounter.

Taxes at source are deducted by the Lottery Organisation prior to the prize being paid out to the winner. For example, if a player wins a $5 million Mega Millions jackpot, then Mega Millions and the US government will take out 30% of that before the player is given the money. Thus the total prize you receive from theLotter will be the prize post-tax.

Taxes that you may be subject to in your country of residence like income tax are the responsibility of the individual players, not theLotter. We recommend you consult with a financial advisor and accountant should you win a huge sum of money like a jackpot.

Taxes not deducted at the source are referred to as "further local taxation." These taxes differ based on the player's country of residence and includes income tax and others. Local taxation is the responsibility of the individual player. In the event of a huge win, we advise winners to contact a financial advisor and accountant who can address local taxation issues.

US Lotteries: Taxes 101

US lotteries are a bit more complicated than some other nations' games when it comes to taxes because their taxes differ depending on the state where the ticket is purchased. The payout of prizes is based on each individual states and includes federal and state taxes; some also include relevant city taxes such as tickets purchased in New York. Below is a list of relevant US multi-state and state lotteries and their individual tax information. Currently a player cannot choose from which state their tickets are purchased for multi-state games. Information is presented for non-US residents only.

US Powerball - Tickets for this lottery are purchased randomly in either Oregon, New Jersey or New York. Lottery prizes are subject to taxation at source. The Oregon Lottery withholds 38% (federal and state) withholding tax from amounts above $600. The New Jersey Lottery withholds 38% (federal and state) withholding tax from all prize amounts above $600. The New York Lottery withholds 44.17% (federal, state and city) withholding tax from all prize amounts above $600. Currently you cannot choose from which state your US Powerball tickets are purchased. The location of purchase will be shown on the scanned ticket.

US Mega Millions - Tickets for this lottery are purchased randomly in either Oregon, New Jersey or New York. Lottery prizes are subject to taxation at source. The Oregon Lottery withholds 38% (federal and state) withholding tax from amounts above $600. The New Jersey Lottery withholds 38% (federal and state) withholding tax from all prize amounts above $600. The New York Lottery withholds 44.17% (federal, state and city) withholding tax from all prize amounts above $600. Currently you cannot choose from which state your Mega Millions tickets are purchased. The location of purchase will be shown on the scanned ticket.

New York Lotto - There are two tax bands. Tax Band 1: Tax-free up to $4999.50. Tax Band 2: Any portion of the prize above $4999.50 is subject to a tax rate of 44.17% (federal, State, City & Yonkers withholding) for non-residents.

New York Cash4Life - There are two tax bands. Tax Band 1: Tax-free up to $4999.50. Tax Band 2: Any portion of the prize above $4999.50 is subject to a tax rate of 44.17% (federal, State, City & Yonkers withholding) for non-residents.

New Jersey Pick 6 XTRA - There are two tax bands. Tax Band 1: Tax-free up to $599.50. Tax Band 2: Any portion of the prize above $600 is subject to a tax rate of 30% for non-residents.

Florida Lucky Money - The Florida Lottery withholds 30% federal withholding tax from all prize amounts for non-residents.

Florida Lotto - The Florida Lottery withholds 30% federal withholding tax from all prize amounts for non-residents.

California SuperLotto Plus - The California SuperLotto Plus withholds 30% federal withholding tax from all prize amounts for non-residents.

* Check the tax laws in your country of residence for any further local taxation you may be subject to.

European and South American Taxed Lotteries

All taxes listed below are deducted at the source.

Colombia - There are two tax bands. Tax Band 1: Tax-free up to Cop70,000. Tax Band 2: Any portion of the prize exceeding Cop70,000 is subject to a tax rate of 20%.
Italy - There are five tax bands. Tax Band 1: Tax-free up to €100. Tax Band 2: The portion of the prize between €100.01 and €300 is subject to a local retailer fee of €1.03. Tax Band 3: The portion of the prize between €300.01 and €500 is subject to a local retailer fee of €3.10. Tax Band 4: The portion of the prize between €500.01 and €1,000 is subject to a local retailer fee of €3.10 and a tax rate of 6%. Tax Band 5: Any portion of the prize exceeding €1,000.01 is subject to a local retailer fee of €6.20 and a tax rate of 6%.
Poland - There are two tax bands. Tax Band 1: Tax-free up to PLN2,280. Tax Band 2: Any portion of the prize exceeding PLN2,280 is subject to a tax rate of 10%.
Romania - There are three tax bands. Tax Band 1: Prizes up to RON66,750 are subject to a tax rate of 1%. Tax Band 2: The portion of the prize between RON66,750 and 445,000 is subject to a flat tax of RON667.50 and a tax rate of 16% on the amount over RON66,750. Tax Band 3: Any portion of the prize exceeding RON445,000 is subject to a flat tax of RON61,187.50 and a tax rate of 25% on the amount over RON445,000.
Russia - There is one tax band of 13%.
Spain - There are two tax bands. Tax Band 1: Tax-free up to €2,500. Tax Band 2: Any portion of the prize exceeding €2,500 is subject to a tax rate of 20%. Citizens of most countries other than Spain are entitled to a full tax refund in order to prevent double taxation. Claiming this refund is the sole responsibility of the player and must be done through the Spanish tax authorities. Tax refunds when approved will be issued during the following calendar year.
Switzerland - There are two tax bands. Tax Band 1: Tax-free up to CHF1,000. Tax Band 2: Any portion of the prize exceeding CHF1,000 is subject to a tax rate of 35%.
Ukraine - There is one tax band of 19.5%.

* Check the tax laws in your country of residence for any further local taxation you may be subject to.

How do I pay taxes on lottery prizes I won through theLotter?

For taxed lotteries, you'll often see the phrase "lottery prizes are subject to taxation at source" in our info pages. This means that the taxes deducted directly by the lottery organisation and the local and/or federal government where the lottery takes place. Prizes are paid out to the winners only after all taxes are deducted. theLotter then deposits the full post-tax prize amount in the winner's account. theLotter takes no commission on lottery prizes.

Often taxes deducted at the source are dependent on the amount of money won. The differing tiers are called Tax Bands. On each individual lottery info page, you'll see each tax band written out in the Tax Requirement section of the info table.