How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask bigduckontax Your Own Question
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 6147
Type Your Tax Question Here...
bigduckontax is online now

If a company and one of its shareholders make a bet and the

Customer Question

If a company and one of its shareholders make a bet and the company loses, does the shareholder receive tax free profit as it is gambling. Obviously the company does not get a deduction for its loss.Of course, if the company wins then the shareholder loses. But what if stake is multiplied until shareholder wins? Is this an effective way of extracting funds from the company tax free?
Submitted: 10 months ago.
Category: Tax
Expert:  bigduckontax replied 10 months ago.

Hello, I am onr of the experts on Just Answer and pleased to be able to help you with your question.

Gambling is outside the scope of UK taxation so the shareholder receives the money tax free. However, the company's articles may preclude gambling which could cause a problem. If the company looses long term then this does not affect the taxation position of either the company or the individual. I would submit that such activities are most improper and would probably require a licence which it almost certainly does not possess.

I do hope that I have shed some light on the situation for you..