Tuesday, 3 February 2026

Professional esports athletes must register for tax.

The law is clear - income from esports by professionals is taxable.

There is a specific inclusion in the gross income definition (the definition used as the starting point to determine an individual’s taxable income) which states that amounts received in relation to services rendered – even if it is a voluntary award – will be included in gross income and subject to tax.

Since a professional esports athletes would either be seen as an employee of, or as an an independent contractor, of the company for which he/she plays (see The basics about contracts for esports athletes) if such employee receives a reward related to his job function, it will be considered gross income as it is linked to services rendered.

Thus winning prize money in a competition if you are a professional esports athlete would  be seen by revenue authorities (SARS) as being related to a job function.
Whether the prize could be cash or otherwise, the prize will still be subject to tax.
If it is a non-cash prize, the monetary worth of that specific item will be included in gross income and subject to tax.
Thus it stands to reason that all companies paying prize monies to professional athletes, and/or to the companies  for which they play, must satisfy themselves that they are complying to SARS rules. The companies receiving such prize money (which often call themselves MGO's) running professional teams need to register with the revenue authorities in regard to declaring their winnings and the withholding of tax on their athletes.

Additional reading:
Athlete's rights:

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Sunday, 1 February 2026

Is a professional gamer in South Africa entitled to a salary?

A former South African Protea team competing in IESF's championship in South Korea.

Only if a professional gamer in South Africa is legally classified as an employee is a professional gamer in South Africa entitled to a salary. Professional gamers in South Africa are not automatically entitled to a salary merely because they are “professional gamers”.

Here is the precise legal position under South African law.

1. Salary entitlement depends on employment status

Under South African labour law, a right to a salary arises only if a person is an “employee” as defined in the:

  • Labour Relations Act (LRA)

  • Basic Conditions of Employment Act (BCEA)

If a professional gamer is not an employee, there is no statutory right to a salary.

2. When a professional gamer is entitled to a salary

A gamer is entitled to a salary if the relationship with the esports organisation/team meets the legal tests for employment, regardless of what the contract is called.

Key indicators of employee status include (Section 200A LRA):

  • The organisation controls training schedules, match participation, conduct, or availability

  • The gamer is economically dependent on the organisation

  • The gamer is integrated into the organisation (branding, mandatory appearances, exclusivity)

  • The gamer must personally render services

  • The organisation supplies equipment, facilities, or infrastructure

  • The gamer works set hours or under direction

If these factors are present, the gamer is legally an employee, and then:

✔ The organisation must pay remuneration (salary/wages)
✔ The BCEA applies (leave, notice, working hours, etc.)
✔ Minimum wage laws may apply, depending on circumstances

Calling the contract a “player agreement” or “independent contractor agreement” does not override reality.

3. When a professional gamer is not entitled to a salary

A gamer is not entitled to a salary if they are genuinely an independent contractor, for example:

  • They operate as a self-employed individual

  • They invoice the organisation for services

  • They can compete for or work with other teams

  • They control their own training time

  • They bear their own business risk

  • Payment is per event, prize share, sponsorship split, or appearance fee

In this case:

✖ No BCEA protection
✖ No statutory salary requirement
✔ Payment is governed only by the contract

4. Important distinction: salary vs prize money

  • Prize money is not a salary

  • Sponsorship revenue sharing is not a salary

  • Appearance fees are not a salary

Only remuneration paid in an employment relationship qualifies as a salary under labour law.

5. Practical conclusion

Professional gamers in South Africa are entitled to a salary only if:

  • They are legally employees under the LRA/BCEA

They are not entitled to a salary if:

  • They are independent contractors or competitors earning prize-based or commercial income

Misclassification carries serious risk:

  • CCMA disputes

  • Back-pay claims

  • PAYE and SARS penalties

Additional reading:
Athlete's rights:

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