Betfair relocating its online gambling operations

Betfair, the international online sports betting exchange, plans to relocate its base in the UK and transfer its license to Gibraltar. The move will allow the company to avoid paying 15% tax on its betting profits in the UK saving an estimated £18.5m in annual taxes. Although not officially disclosing the amount of tax it will save, unofficial projections suggest profits should increase by £10m in 2012 and £20m the next year with the company receiving the benefit of Gibraltar’s low 1% tax on its total betting profits.

The company admitted tax advantages played a major part in their decision to move but an opportunity to strengthen the company’s technology base was also cited as a contributing factor.

Betfair joins the ranks of other prominent online gambling and sports betting exchanges such as Ladbrokes and William Hill who have relocated some of their online gambling operations offshore to Gibraltar in response to the steep gambling levy imposed by the Government.

Notwithstanding its decision to relocate, the company announced it has no plans to transfer its estimated 1,200 employees, most of whom are based in the UK, to Gibraltar. In addition, Betfair has confirmed its continued support of British horse racing by paying racing levies legally required by companies operating a gambling license issued in the UK.