Eurojackpot Taxes — Do I Have to Pay Tax on My Winnings?

The Good News First

In Germany, lottery winnings are fundamentally tax-free. Whether you win 10 euros in prize tier 12 or 120 million euros in the jackpot — the winnings themselves are subject to neither income tax nor gift tax nor any other levy.

This applies to all state-run lotteries in Germany, including Eurojackpot, LOTTO 6aus49, GlücksSpirale, and all instant-win lotteries. The reason: lottery winnings are not classified as income under tax law, but as a stroke of luck — comparable to a gift from chance.

But — and this "but" is crucial — the tax exemption ends at the point where you generate returns with your winnings.

Germany: Tax Rules in Detail

The Winnings Themselves: Tax-Free

Section 2(1) of the German Income Tax Act (EStG) defines seven types of income subject to income tax. Lottery winnings fall under none of these categories. They are neither income from self-employment or employment, nor from business operations, capital assets, rental income, or other income.

Important: This tax exemption applies without restriction and without an upper limit. There is no obligation to report the lottery win itself to the tax office.

Returns on the Winnings: Taxable

As soon as you invest your Eurojackpot winnings, the returns generated are taxed normally:

The tax rate of 26.375% comprises 25% flat-rate withholding tax + 5.5% solidarity surcharge on top. If subject to church tax, an additional 8-9% church tax applies to the withholding tax depending on the federal state (effectively approximately 27.8-28.6%).

Example Calculation: 120 Million Euro Jackpot

Suppose you hit the Eurojackpot maximum prize of 120 million euros and invest the amount conservatively at 3% annual interest:

• Winnings: 120,000,000 euros — tax-free
• Annual interest: 3,600,000 euros
• Withholding tax + solidarity surcharge: ~950,000 euros
• After tax: ~2,650,000 euros interest per year

Even after tax, you earn approximately 2.65 million euros per year from your winnings — just through safe interest-bearing investments. With an investment in broadly diversified equity ETFs (historical return ~7%), it would be correspondingly more, but with higher volatility.

Austria: Same Basic Rule

In Austria too, lottery winnings are tax-free. The Austrian Income Tax Act does not treat gambling winnings as taxable income. Taxation occurs — as in Germany — only at the level of capital returns.

Specifics in Austria

• Capital gains tax (KESt): 27.5% on interest, dividends, and capital gains
• No wealth tax: Austria does not levy a wealth tax on total assets
• Gift/inheritance: No inheritance tax, but property transfer tax on real estate transfers and a reporting obligation for gifts exceeding 50,000 euros (within 5 years to the same person)

Austria participates in EuroMillions, not Eurojackpot. However, the tax rules apply analogously to all lottery winnings.

Switzerland: Canton-Dependent and Often Taxable

Switzerland is the special case in the DACH region. Here, lottery winnings can actually be taxable — and substantially so.

Federal Level

Since 1 January 2019, the revised Gambling Act applies. Lottery winnings up to 1 million CHF are tax-free at the federal level. Winnings above 1 million CHF are taxed as income, with the first 1 million CHF serving as an exemption.

Cantonal Level

In addition to federal tax, most cantons levy their own income tax on lottery winnings. The rules vary considerably:

Example: A Eurojackpot win of 10 million CHF in the canton of Zurich. The exemption of 1 million CHF is deducted, and the remaining 9 million CHF is taxed at the personal marginal tax rate. Depending on the municipality and other income, the tax burden can amount to 3-4 million CHF.

Switzerland participates in neither Eurojackpot nor EuroMillions officially, but Swiss citizens can participate in European lotteries through online providers. Swiss tax rules apply regardless of the country in which the lottery is organised.

Withholding Tax

On winnings from Swiss lotteries, a withholding tax of 35% is deducted at source. This can be reclaimed on the tax return (credited against income tax). For foreign lotteries, there is no source deduction — the declaration obligation lies with the taxpayer.

Interest and Capital Returns: Where Tax Kicks In

Regardless of the country: capital grows, and growth is taxed. For a million-euro win, there are various investment options — and each has tax consequences.

Safe Investments

Growth-Oriented Investments

Tip: Accumulating equity ETFs benefit from the partial exemption of 30% in Germany — only 70% of the returns are taxed. Effectively, you pay around 18.46% instead of 26.375%. For amounts in the millions, this can make a significant difference.

Gifting a Lottery Win

Would you like to share your Eurojackpot winnings with family or friends? This is where it becomes tax-relevant — even in Germany.

Gift Tax in Germany

Gifts are subject to the Inheritance and Gift Tax Act (ErbStG). The following exemptions apply:

Example: You win 10 million euros and want to gift 1 million euros to your best friend. Exemption: 20,000 euros. Taxable gift: 980,000 euros. Tax rate (tax class III): 30%. Gift tax: 294,000 euros.

For family members, the picture is better: a gift of 1 million euros to your child triggers, with an exemption of 400,000 euros and a tax rate of 11% on the remaining 600,000 euros, a tax of 66,000 euros.

Alternative: Lottery Syndicate

Those who wish to avoid gift tax should arrange the prize distribution before the draw: a written syndicate agreement established before the draw means that each member receives their share directly as a lottery win — and not as a gift. This makes each member's share tax-free.

Caution: The agreement must exist before the draw and clearly govern the distribution. A retroactive "syndicate" will be treated by the tax office as a disguised gift.

Syndicates and Tax

Lottery syndicates are an elegant solution from a tax perspective:

• Before the draw, a contract is signed that governs the prize distribution
• Each member receives their share as their own lottery win — tax-free
• No gift tax applies because there is no gift
• The returns on their respective share are taxed by each member individually

Formal Requirements

For the tax office to recognise the syndicate, the contract should contain the following points:

• Names of all members and their shares
• Method of bet placement (who submits the slip?)
• Clear prize distribution (equal shares or proportional to stake?)
• Signatures of all members
• Date before the relevant draw

Caution: a WhatsApp message along the lines of "I'll share with you if I win" is not a recognised syndicate. The tax office will treat this as a gift.

Disclaimer: Not Tax Advice

This article is for general information purposes and does not replace professional tax advice. Tax law is complex and subject to constant change. In the event of a larger lottery win, you should immediately consult a tax advisor or specialist lawyer for tax law — ideally before you cash in the winnings or share them with anyone.

Particularly for winnings over 100,000 euros, we recommend:

• Tax advisor for ongoing taxation of capital returns
• Wealth advisor for a tax-optimised investment strategy
• Notary for gifts or syndicate agreements
• Specialist lawyer for inheritance law for estate planning questions

Current information on prize tiers and payouts can be found on our prize tiers page.

Frequently Asked Questions

Do I have to pay tax on my Eurojackpot winnings in Germany?

No. Lottery winnings are fundamentally tax-free in Germany — regardless of the amount. Only the returns you generate from the winnings (interest, dividends, rental income, etc.) become taxable.

Do I have to report the winnings to the tax office?

You do not need to declare the lottery win itself in your tax return. However, you must declare the capital returns on the invested winnings — unless these are already withheld at source (e.g., by the bank) through the flat-rate withholding tax.

How do I avoid gift tax when sharing the winnings?

The safest way is a written lottery syndicate established before the draw. Each member then receives their share as their own lottery win (tax-free) and not as a gift. Retroactive distributions are taxed as gifts.

Are winnings from online lotteries taxed differently?

No. Whether you submit your Eurojackpot bet at a retail outlet or online — the tax treatment of the winnings is identical. What matters is your country of residence, not the sales channel.

Further Information

• Prize Tiers & Payouts — All 12 prize tiers at a glance
• Current Payouts — Results and distributions from recent draws

Responsible Gaming

The prospect of tax-free million-euro winnings should not be a reason to play beyond your personal budget. Lotteries are an entertainment product — only wager money you do not need.

If you need help, contact the German Federal Centre for Health Education (BZgA):

• Phone: 0800 1 37 27 00 (free of charge)
• Website: www.bzga.de