Do you pay tax on lottery winnings in South Africa?

If you win a Lotto, Lotto Plus, PowerBall or Daily Lotto prize from the South African National Lottery, you get the full amount. Nothing is taken off for tax before you are paid, and you do not pay income tax on it afterwards.

SARS treats a lottery win by someone who plays for fun as a windfall, not as income from work or a business. Lottery winnings are also left out of capital gains tax.

• Interest and investment returns. Once the prize is in your account, the interest it earns and any profit from investing it are taxed like anyone else's.
• Large gifts. Giving money away can trigger donations tax. Each person can give up to R100,000 a year without it; above that, donations tax applies. Gifts between spouses are exempt.
• Professional gamblers. If gambling is how you make your living, SARS can treat winnings as income.
• Your estate. Money you still hold when you die counts towards your estate, as any other savings would.

Tax rules can change, and a large win raises questions about investing, gifts to family and wills. Speak to a registered tax practitioner or contact SARS before you make big decisions. This page is general information, not tax advice.

Before any of that, make sure you claim in time: how to know if you won, and how to claim.