A mystery winner from Sydney’s eastern suburbs is now $100 million richer after Thursday’s Powerball draw 1517, but they might be completely unaware of their life-changing fortune. The unregistered ticket holder picked the winning numbers 28, 10, 3, 16, 31, 14, and 21 with Powerball number 6.
This makes them Australia’s third-biggest lottery winner ever, joining an exclusive club of only six Australians who have won $100 million or more. But here’s where the fun math begins – and where many winners get caught off guard.
The Good News: ATO Won’t Touch Your $100 Million
Let’s start with the celebration-worthy news. The Australian Taxation Office (ATO) has confirmed that “You don’t need to declare your winnings to us, and you won’t pay tax on them”. Your $100 million stays exactly that – no government slice taken out.
Unlike countries where the taxman swoops in immediately, Australia treats lottery wins as “windfall gains” rather than taxable income. This means our mystery Sydney winner gets to keep every single dollar of their jackpot.
The Plot Twist: Where the Tax Fun Really Begins
Here’s where your financial calculator becomes your new best friend. If you park that $100 million in a savings account earning 5% interest, you’d generate around $5 million in just one year. Come tax time, that $5 million becomes fully taxable income.
Let’s break down the juicy math:
- Year 1 interest: $5,000,000
- Tax on $5M (top tax bracket 47%): $2,350,000
- Your take-home from interest: $2,650,000
You’d still pocket $2.65 million annually just from interest – not too shabby for doing absolutely nothing!
Centrelink Recipients: The $100 Million Reality Check
The Asset Test Bomb
If you’re currently receiving Centrelink payments, winning big creates an immediate problem. Services Australia doesn’t usually count lottery wins as income because they’re considered a one-off event, but how you receive your winnings matters crucially.
The golden rule: Take the lump sum, and your winnings become an asset rather than income. But if those assets push you over Centrelink’s thresholds, your payments could vanish faster than your lottery ticket.
The Frank Kemmler Warning
South Australian resident Frank Kemmler learned this lesson the hard way when he was kicked off his disability support pension after winning $60,000. The Adelaide man had to suddenly pay for GP appointments and medication that was previously covered by his pension.
“I’m just trying to stop other people from falling into the same trap,” Kemmler told A Current Affair. “These people buying lottery tickets, there’s no warning anywhere”.
The Installment Payment Trap
Why Monthly Payments Could Cost You Everything
If you choose to have your winnings paid out in regular installments over several years, Centrelink may treat those payments as income, which could reduce or even cancel your benefits. This transforms your lottery win from a blessing into a Centrelink nightmare.
Smart move: Always choose the lump sum if you’re on government benefits. It’s treated as an asset, not ongoing income, giving you more control over your financial future.
The $100 Million Math: What Your New Life Looks Like
Let’s have some fun with the numbers and see what $100 million actually means in everyday terms:
Daily Spending Power
- $273,973 per day for a year without touching the principal
- $11,415 per hour (if you never sleep)
- $190 per minute around the clock
Interest Income Scenarios
- Conservative 3% return: $3 million annually
- Moderate 5% return: $5 million annually
- Aggressive 7% return: $7 million annually
Even being ultra-conservative, you’d earn more in interest each year than most Australians earn in their entire lifetime.
Smart Strategies: Making Your Fortune Last
The Tax-Smart Approach
Professional financial advisors suggest spreading investments across different vehicles to minimize tax impact:
- Property investments (negative gearing opportunities)
- Superannuation contributions (concessional tax rates)
- Charitable donations (tax deductions up to 50% of income)
- Family trusts (income splitting possibilities)
The Centrelink-Safe Strategy
A good adviser can help you structure your finances to minimize tax and make your money last while protecting any government benefits you might want to maintain.
What Not to Do: Common Million-Dollar Mistakes
The Gifting Trap
Services Australia has gifting rules, and anything over that threshold will count in their assets test. Give away too much too quickly, and you might still lose your Centrelink payments.
The Trust Confusion
You could put winnings into a trust, however, Centrelink might still treat it as a gift depending on who has control of the trust.
The 2025 Reality: Why This Matters More Than Ever
This year’s $100 million jackpot marks the biggest Powerball prize of 2025, coming after a year where 21 Powerball division one winners shared more than $773 million in prize money.
With over 10 million Australians buying tickets for major draws, the chances of more big winners increase – and so does the need for proper financial education.
Your Action Plan: What to Do If You Win
Immediate Steps (First 24 Hours)
- Sign your ticket immediately
- Take photos as backup proof
- Contact The Lott to register your win
- Don’t tell anyone except immediate family
First Week Priorities
- Call Centrelink if you receive payments
- Contact a financial advisor specializing in windfalls
- Speak with an accountant about tax implications
- Consider legal advice for asset protection
Long-term Planning
- Diversify investments across multiple asset classes
- Set up proper tax structures before investing
- Plan for family and charitable giving
- Protect your wealth from potential legal challenges
The Bottom Line: Million-Dollar Math Made Simple
Winning $100 million isn’t just about the money – it’s about understanding the complex web of tax and social security implications that could dramatically impact your financial future.
The key is being upfront with authorities and getting professional advice quickly. Failing to report changes in circumstances can lead to overpayments, debts, or even legal trouble.
Frequently Asked Questions
Q: Do I pay tax on lottery winnings in Australia?
A: No, lottery winnings are tax-free in Australia, but you pay tax on any interest or investment returns.
Q: Will winning affect my Centrelink payments?
A: Yes, large wins can impact asset tests and may reduce or cancel your payments.
Q: Should I take lump sum or installments if I’m on Centrelink?
A: Always choose lump sum – installments are treated as income and can severely impact benefits.
Q: How much interest would $100 million earn?
A: At 5% interest, you’d earn $5 million annually, with $2.65 million after tax.
Q: Do I need to tell Centrelink immediately if I win?
A: Yes, you must report the change in your financial circumstances as soon as possible.
Also Read: Your Sydney Neighbor Just Won $100 Million and Doesnt Know It Yet