Matched betting Australia: how it works, maths and the rules

Key facts

Matched betting backs an outcome at a bookmaker and lays the same outcome on a betting exchange, so you finish close to level whatever happens. Any profit comes from promotions.
Licensed online wagering providers cannot offer incentives to open an account or to refer someone, under Measure 4 of the National Consumer Protection Framework (in force since 2019).
A $50 bonus bet backed at $5.00 and laid at $5.20 with 6% commission keeps $36.58 whichever side wins, because the bonus stake is not returned.
The TAB's Conditions of Use say promo benefits are intended for recreational gamblers only, and that it may refuse a bet without giving reasons.
The ATO treats betting and gambling wins as not assessable unless you operate a betting or gambling business.

What matched betting is

Matched betting means placing two opposite bets on the same outcome: a back bet with a bookmaker that it will happen, and a lay bet on a betting exchange that it will not. Sized correctly, the two cancel out, so you finish close to level whichever way the event goes. On its own that achieves nothing except a small loss. The point is to use it on a bookmaker promotion, such as a bonus bet, and turn the promotion into a known amount of cash.

Why matched betting is different in Australia

The method is the same everywhere, but Australian rules remove the offers it is best known for overseas. Under Measure 4 of the National Consumer Protection Framework for online wagering, "online gambling providers cannot offer any incentives to open an account or to refer another person to open an account". The Department of Social Services says the measure was implemented on 26 May 2019 in every jurisdiction except NSW, and on 26 November 2019 in NSW, and that the framework applies to all licensed online wagering providers.

So there are no sign-up bonuses to match from licensed Australian bookmakers. What is left are promotions for existing customers, such as bonus bets, and those come with the bookmaker's own conditions. Our page on betting sign up bonuses in Australia looks at betting offers in more detail.

How a lay bet works

A lay bet is a bet that something will not happen, placed on an exchange where another punter takes the other side. If you lay a team at $2.16 for $50 and the team loses, you win the $50 (less commission). If the team wins, you pay the backer's profit: $50 x (2.16 - 1) = $58. That $58 is your liability, and the exchange holds it from your balance until the bet settles. The lay bet calculator works out your liability and your profit after commission for any price.

Betfair is the exchange most Australians know. Its site says Betfair Pty Limited is licensed and regulated by the Northern Territory Government. It charges commission on net winnings in each market, at a market base rate that its guide gives as usually 8% on Australian racing, 6% on sports and 10% on NRL.

The maths of a qualifying bet

A cash bet that is fully matched usually loses a little: the exchange takes commission, and in this example the lay price is also 6 cents longer than the back price. With back stake B, back odds Ob, lay odds Ol and commission c:

Lay stake = B x Ob / (Ol - c)

Back $50 at $2.10 with a bookmaker and lay at $2.16 on an exchange charging 6%: lay stake = 50 x 2.10 / (2.16 - 0.06) = $50.00, and your liability is $58.00.

Result	Bookmaker bet	Exchange bet	Net
Team wins	+$55.00	-$58.00	-$3.00
Team loses	-$50.00	+$47.00 ($50 less 6%)	-$3.00

You lose $3.00 whichever way it goes. At 10% commission the same bet needs a lay of $50.97 and costs about $4.13.

Turning a bonus bet into cash

A bonus bet is where the maths works for you. On the TAB, when a bonus bet wins the stake goes back to TAB and only the winnings are credited, so the lay is sized on the winnings only:

Lay stake = bonus x (Ob - 1) / (Ol - c)

A $50 bonus bet backed at $5.00 and laid at $5.20 with 6% commission needs a lay stake of $38.91 and a liability of $163.42.

Result	Bonus bet	Exchange bet	Net
Your pick wins	+$200.00 winnings	-$163.42	+$36.58
Your pick loses	$0 (bonus gone)	+$36.58 ($38.91 less 6%)	+$36.58

You keep $36.58 of a $50 bonus, or 73.15%, either way. The back price makes a big difference:

Back and lay price	Lay stake	Liability	Kept from a $50 bonus
$2.00 and $2.04	$25.25	$26.26	$23.74 (47.47%)
$5.00 and $5.20	$38.91	$163.42	$36.58 (73.15%)
$9.00 and $9.60	$41.93	$360.59	$39.41 (78.83%)

Longer prices keep more of the bonus but need far more cash in the exchange account to cover the liability. Commission matters too: the same $5.00 and $5.20 bet at 10% commission keeps $35.29. Check the bonus terms first: the TAB says most of its bonus bets are valid for 7 days and bets placed with them cannot be cashed out.

Pundit tip: do the sums before you place either bet, and place the lay straight after the back. A price that moves between the two can turn a locked-in amount into a gamble.

Is matched betting legal in Australia?

We found no Australian law that names or bans matched betting. Licensed sports and racing wagering is one of the services the Interactive Gambling Act allows with an Australian licence, and adults can bet with those providers. What decides how long matched betting lasts for you is the operator's terms. The TAB's Conditions of Use, for example, say:

Clause	What it says
5.3	You must only hold one account for each approved jurisdiction unless authorised
16.1	TAB may place limits on the bets you can buy over a period
34.1	TAB may refuse a proposed bet at its discretion, without notice or reasons
62.8	A promotion can be cancelled at any time at TAB's discretion
63	A promo benefit may be withheld or cancelled if a code is used across linked accounts, devices, households or shared details, or if TAB suspects collusion
63.2	Promo benefits are intended for use by recreational gamblers only

The words "matched betting" do not appear in the part of those terms we read, but the clauses give the operator plenty of room. If the operator decides you are not a recreational gambler, clause 63.2 is the one that lets it stop your promotions.

Tax on matched betting

The ATO lists "betting and gambling wins (unless you operate a betting or gambling business)" among amounts that are not assessable income. We found no ATO guidance that mentions matched betting by name. If you bet at a volume, with a system and records that look like a business, get advice from a registered tax agent.

What can go wrong

Wrong stake or wrong market. A lay on the wrong selection, or on a market with different rules, leaves you exposed.
Different settlement rules. A bookmaker market that includes extra time and an exchange market that does not are not a match.
Voids. If one side is voided and the other is not, you are left holding a live bet.
Cash tied up. Liabilities on long prices can be many times the bonus.
Account limits. As the terms above show, operators can limit, refuse and withdraw offers.

Matched betting uses the same maths as arbitrage. Our guide to arbitrage betting in Australia and the arbitrage calculator cover the bookmaker against bookmaker version, and the implied probability calculator shows what a price really implies. To lock in a profit on a bet you already hold, see hedging bets and the hedge bet calculator. Matched betting works the promotion, not the price; value betting is about finding prices longer than the real chance deserves. If betting stops feeling like maths and starts feeling like chasing, our gambling help page lists free support.

Frequently asked questions

Is matched betting legal in Australia?

We found no Australian law that names or bans matched betting. Betting with licensed Australian bookmakers and exchanges is legal for adults. The real limits are each operator's terms, which let them withhold promotions, limit bets and close accounts.

Can you do matched betting with sign-up bonuses in Australia?

No. Under the National Consumer Protection Framework, licensed online wagering providers cannot offer any incentive to open an account or to refer someone else. Matched betting in Australia can only use offers made to existing customers, such as bonus bets.

How do you work out a lay stake?

For a cash bet, lay stake = back stake x back odds / (lay odds - commission). For a bonus bet where the stake is not returned, lay stake = bonus x (back odds - 1) / (lay odds - commission). Commission is written as a decimal, so 6% is 0.06.

Do you pay tax on matched betting profits in Australia?

The ATO lists betting and gambling wins as not assessable unless you operate a betting or gambling business. We found no ATO guidance that names matched betting, so get advice if you bet at a scale that could look like a business.

Why do bookmakers restrict matched bettors?

Bookmaker terms give them wide discretion. The TAB's Conditions of Use say promo benefits are intended for recreational gamblers only, that it may place limits on the bets you can buy, and that it may refuse a proposed bet without giving notice or reasons.