Again and again, the courts deal with whether games like poker are actually games of chance or whether the outcome of the game actually depends on the skill and skill of a player. The question is crucial to whether or not a player has to pay taxes on their winnings. Problems can also arise with banks, as the case of the professional poker player Sontheimer recently showed.
Poker is a game of skill, not chance
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In general, in Germany and in many other European countries, winnings from approved games of chance, including online roulette games in mobile casinos, are tax-free. In poker and some other real money games like skat, the question of whether to gamble or not is actually not that easy to answer.
Casual gamers don’t need to worry
Anyone who occasionally plays a few rounds of poker and wins something needn’t worry about depositing the winnings into their account. Occasional gambling is considered a game of chance according to the current legal opinion. The profits, even if they are very high profits, do not have to be taxed in this case. However, it is a condition that the player otherwise pursues another main occupation or has other income from which he makes his living.
It looks a little different from professional gamers who make a living from gambling. With this group of players, the courts and ultimately also the tax office assume that a large part of “skill” is involved and that long-term profits can be achieved through specialization. Professional players must pay taxes on all winnings. However, the usual tax allowances also apply to this group of players.
This view is supported, for example, by experts from Heidelberg University. These have examined poker closely for their “luck component”. Poker was evaluated using a so-called ELO system, similar to chess. It was found that the proportion of luck in popular poker games such as Texas Hold’em or Caribbean Stud Poker is more than 50 percent if you only play occasionally.
With regular games, as practiced by professional poker players, there is a high probability that the skill and dexterity of the player account for more than 50 percent of the outcome of the game, and thus the proportion of luck decreases. Unfortunately, some tax officials or bank employees do not see it that way, so that there are always legal disputes over the question of whether poker is actually a game of chance.
Poker professional player Peter Sontheimer couldn’t believe his eyes
The majority of the courts’ legal opinion that playing poker with professional players is not a game of chance but should be assessed as a “normal income” has not yet penetrated everywhere.
One morning, the German poker pro couldn’t believe his eyes when he looked in his mailbox and held the cancellation of his account by Commerzbank in his hands. He earns his money by playing poker regularly and thus has a sufficient income. However, an employee at his bank saw it very differently.
He was of the opinion that the regular winnings that came into his account came from gambling. Furthermore, the employee was of the opinion that gambling was not allowed in Germany and unceremoniously canceled the player’s bank account. It is not known whether Sontheimer is suing his bank to reopen the account and possibly also for damages or whether he has simply opened an account with another bank. However, he tweeted somewhat ironically:
“If you play professionally, poker is not a game of chance, which is why you have to pay taxes on it in Germany. How good that @commerzbank called me this morning to tell me they are closing my business account because they don’t support gambling-related things. “
In any case, the fact is that games of chance are also allowed in Germany if it is a licensed game of chance. After all, playing and winning in a casino like the Baden-Baden casino or the casino on Potsdamer Platz are no problem either. Most online casinos, on the other hand, currently have a license from another country in the European Union, such as Malta.
This is also possible in Germany so that legal and tax-free gaming is also possible here for casual gamers. For a long time, there was an unclear legal situation regarding online gambling in Germany, which has caused a lot of confusion. In the coming year, however, the new version of the State Treaty on Gaming will come into force.
This is the first time that online gambling is officially legalized in Germany. So far it has only been tolerated because of the regulations in force in the EU. So if Mr. Sontheimer wanted to sue his bank, he would have a good chance that his account will be reopened.