Getting a Home Loan as a Pro Punter
 

Have any of the full time punters here managed to get a home loan after turning pro? Did the lender treat gambling income as proof of ability to service the loan? Did the lender just want to see evidence of wealth growth? Or was the gambling a big no-no?

Please no speculation or gambling advice, would like to hear from actual experience dealing with lenders.

A can of worms Fred. Let's assume that you have a good credit rating. With a steady job and sufficient income to service the loan, then you can get a loan to 85% of the value of the property. With a gambling income you get lumped into the self employed category and a no-doc loan of a max 65% of the value of the property. No-doc you are riding on your credit rating and not your income. There are many ways to get around these restrictions and this forum is not a place to discuss them.

Fred, you do not have to declare you are a professional punter.
Your credit rating, your last tax assessment notice and three months worth of bank statements should be more than enough.

Set up a sole trader account such as Fred trading as Global Accounting or Internet Marketing or similar.
Transfer money from another bank using another sole trader account on a weekly or monthly basis, so they see regular amounts going in.

If you tell them you are a pro punter it's all over. They'll look at you like you have two heads.
If your balance is high enough and you've a long enough history with the money transfers etc. You may not need a Tax Assessment notice. Make sure you have an ABN. They will check it's legitimate.

It's important you do nothing that could be deemed fraudulent however, you you can name your punting whatever you like legally, that's your business.

Another factor that may add credence to your application is assets other than money.

Thanks for the advice guys.

Beton, where would I find out about the other ways to get around the restrictions?

An issue for me is that I believe it's only a matter of time before the ATO goes after pro gamblers (which I'm not, it's just a full-time hobby for me). If that happens, anyone who operates their gambling like a business will be hit with a tax bill for the last 7 years. Maybe it will never happen but I would never risk it. So that would exclude getting an ABN or setting myself up as a sole trader.

I have other ways of raising finance, but a bank loan is the cheapest. But as you say CP I would hate to apply only to discover that the mere mention of gambling makes me a two-headed monster and destroys my credit rating.

Just as a thought for yourself and anyone else looking at this maybe investing some money in another business to make things more legit in the eyes of the banks.

This would be the path i would choose if i could afford to punt full time.

Agree, it's also nice being able to say that you are a contributing, tax-paying member of society.

Sorry I should have clarified, the ABN will give you more credibility as a sole trader, so set up a business.
There's no way the tax office will come after you as a pro punter anyway.
Can you imagine the GST claims from all losing punters coming in?
Software, computers, adsl lines, foxtel, formguides, petrol, car repairs.
It would be a rort and they know it.

Plus if you work fulltime or part time as well, then you;d pay no tax at all as a losing punter. So the ATO would have to give you back all tax you've paid!!!

A winning punter of course could give net profit after commission, and other deductions, but part of your business could involve overseas travel at your expense including hotel accomodation.

It's a deep deep hole they have no answer to, plus it used and still could be a cash only business ;)

You're only really in trouble if you rent an office and hire staff (apart from your spouse). Many large punters have been asked and the ruling always comes down, not a taxable business.

Fred

Have a long chat with a broker and get it in black and white and grey what you want and what you can and what you can't. Armed with this knowledge you can either utilise this broker or go to broker No 2 and only tell him what he needs to hear.

I changed jobs back in 74 for 4 mths to get a 5% fixed loan. best investment ever.

Thanks Beton, that's a very good idea.

CP you are right that it is utterly ridiculous for the ATO to tax winners they deem to be "business like". Every long-term loser need only produce a spreadsheet where they have balanced their accounts, and voila it's a tax right off. Problem is that they have taxed a few punters already. Say it's a 1% chance of happening to me - well I can handle a 3 month recovery time, but that 1% risk of being taxed is too much for me to stomach.

Who are these punters ? And I suspect you will find they were not "gambling". For example, If you trade out (arb) then you are now trading stock and are not officially gambling.

There is NO chance of person who actually backs horses or sports being ever taxed by the ATO.

ALso if your talking about David Walsh and Zeljko Ranogajec and his club then they were not gambling either. They were being paid to provide liquidity which again is not gambling.

If you trade out of your positions... then yes you should be taxed. If you are just placing a bet on a horse or horses and you can lose the whole amount then the ATO will not chase you.