Do casino loyalty points count as a financial asset

E

ElBurito

Member
Not sure if this kind of question fits here but couldn't think of a better place to ask.

Most casinos have loyalty or reward points you accumulate over time and in some cases you can convert them to real money or use them as betting credit. Does that make them a financial asset in a legal sense? and if so does receiving them count as taxable income in any jurisdiction, or are they just treated like supermarket points that happen to be attached to a gambling account?
 
In most EU jurisdictions loyalty points are treated the same as supermarket reward points, no taxable value until converted to cash. The moment they become withdrawable funds they fall under standard gambling winnings rules, which in most European countries means no tax for recreational players.
 
i read somewhere that the UK was looking into reclassifying casino reward schemes as financial instruments but have no idea if that actually went anywhere.
 
The taxable income question really depends on where you are. In the US for example any gambling winnings including converted points are technically reportable income above certain thresholds. The IRS doesn't care whether it started as points or a direct cash win.
 
The more interesting question is whether unconverted points have any legal protection if a casino goes under. You've accumulated thousands of points and the site closes. Are those points a liability the administrator has to honour or do they just disappear.
 
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