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| The law is clear – income from esports by professionals is taxable. The law is pretty clear: any money you get from playing esports professionally counts as income, and you have to pay taxes on it. This is true even if it’s a prize or an award you weren’t expecting. It all gets added to what’s called your “gross income,” which is the starting point for figuring out how much tax you owe. Think of it this way: if you’re a professional esports player, you’re either working for a company as an employee or as an independent contractor. If you get a prize or an award because of your job, the tax folks (like SARS) see it as part of your earnings. So, winning prize money in a competition is just like getting paid for your work. It doesn’t matter if the prize is cash or something else, like a fancy new computer. If it’s not cash, they’ll figure out how much it’s worth in money, and that amount will be added to your income for tax purposes. Because of these rules, all the companies that give out prize money to professional gamers, or to the teams they play for, need to make sure they’re following SARS’s rules. The companies that run these professional teams (often called MGOs) also need to sign up with the tax authorities. This is so they can report their winnings and make sure the right amount of tax is held back from their players’ earnings. More to Read:
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