Finnish Supreme Court Rules Bettors Can Deduct Losses From Taxable Income

Finland’s Supreme Administrative Court has concluded a multi-year legal case by ruling that professional bettors can deduct their losses from taxable income. The decision was made in favour of Antti Koivula, a professional gambler with over a decade of experience, setting a significant precedent for how such activities are taxed in the country.

The dispute originated from Koivula’s 2020 tax assessment. During that year, he placed approximately €366,000 in wagers, generating returns of around €407,000 and a net profit of €41,000. However, Finnish tax authorities initially assessed each bet in isolation. Under this interpretation, his losing stakes were not considered costs incurred in the pursuit of generating income from his winning bets.

This method of calculation could have led to a disproportionate tax liability. Koivula told the publication Nettipokeri that based on the tax authority's initial stance, his €41,000 profit could have resulted in a tax bill of €166,000.

Court Recognises Systematic Activity

After more than five years, the case reached the nation's highest administrative court. The court’s ruling did not classify Koivula’s activities as a business under the Business Income Tax Act. Instead, it acknowledged the activity as a form of income generation, taking into account several factors: the systematic nature of his betting, his expert knowledge of the markets, the decade-long duration of his professional activity, and its economic importance to his livelihood.

Writing on LinkedIn, Koivula, who is also the Chief Compliance Officer for operator Hippos ATG, commented on the outcome.

The case concerned his personal income taxation and determined the tax treatment of professional bettors in Finland.

Joonas Karhu, a lawyer at Huhtikuu, provided further analysis of the decision. Karhu highlighted that the ruling means stakes from unsuccessful wagers can now be deducted from taxable betting winnings. He also stated that the court permitted the deduction of travel expenses between a bettor's home and workplace.

Implications for Future Market

While the judgment establishes a clear principle, the court did not provide a rigid definition of what constitutes professional betting for tax purposes. Specifics such as required working hours, stake sizes, or income thresholds were not defined. The decision comes ahead of significant changes in the Finnish market, which is scheduled to transition to a new licensing model in July 2027.

Speaking to Nettipokeri, Koivula said he believes the ruling could prove beneficial for professional betting in Finland under the forthcoming system.