Kyle Larson, NASCAR Cup Series champion and driver for Hendrick Motorsports, recently repeated his victory at the High Limits International race in Perth, Australia, only to see a substantial portion of his AUD 110,000 prize withheld due to Australian taxation. Larson’s experience highlights the financial complexities faced by international athletes, as nearly one-third of his Australia prize money was lost to required taxes before he could receive his winnings.
Kyle Larson Triumphs at the High Limits International in Australia
Returning to Australia for the prestigious High Limits International, Kyle Larson demonstrated his skill among a field of top sprint racing drivers at Perth Motorplex. In the 2025 edition of this open sprint event, Larson went head-to-head with several top names, including his protégé Corey Day, as well as Buddy Kofoid and Rico Abreu. Larson took the race lead from Buddy Kofoid and managed to defend it against persistent challenges from Day and Abreu, ultimately securing the largest winner’s purse in Australian sprint racing history—AUD 110,000.
Larson’s accomplishment in Perth came on the heels of a successful NASCAR Cup Series season, where he edged out Denny Hamlin for the championship. This victory in Australia further cemented his reputation as one of the top American drivers able to excel on the global stage. The substantial prize money, however, brought with it unique complications not seen in most domestic racing circuits.
Australian Tax Regulations Impact on Prize Money for Foreign Athletes
Australian Tax Office rules require international athletes, such as Kyle Larson, to pay taxes on income earned within Australia. This policy covers not only race winnings, but also appearance fees and other forms of performance compensation for non-residents. For Larson, whose prize was less than AUD 135,000, the tax rate stands at 30 percent.
Consequently, before Larson could collect his winnings, AUD 33,000 was automatically deducted and forwarded to the Australian Tax Office. After taxes, Larson’s take-home total was reduced to AUD 77,000, which equates to roughly USD 55,000 to USD 56,000 at current exchange rates. The event organizers managed the process directly, withholding the required tax before disbursing Larson’s share.
This situation poses a question for internationally competing drivers—and their fans—as to whether Larson is also obligated to pay further taxes upon returning to the United States with his racing earnings from Australia.
The U.S. Tax Implications for International Prize Money
Under U.S. tax law, citizens like Kyle Larson must disclose worldwide income on their federal tax returns. However, the Internal Revenue Service provides a foreign tax credit system, allowing taxpayers to offset U.S. tax obligations with taxes already paid to foreign governments on the same income. In cases where the foreign tax rate exceeds or matches that of the United States, as with Australia’s 30 percent on Larson’s prize, U.S. tax liability is generally eliminated by the foreign tax credit (FTC).
Although there is a Foreign Earned Income Exclusion provision, it does not extend to prize monies or to taxpayers who do not meet the criteria of spending more than 330 days abroad. As a result, Larson’s Australian tax payment will likely prevent him from owing any additional U.S. tax on this particular race earning.
Larson’s Relentless Racing Schedule Continues with Tulsa Shootout
Even after clinching the largest purse in Australian sprint car racing, Kyle Larson shows no intention of slowing down. He quickly shifted his focus to the Tulsa Shootout in Oklahoma, preparing to compete in multiple divisions alongside his children. The event promises further excitement as NASCAR peers like Kyle Busch and Ty Gibbs join the competition, adding familiar rivalry to the track.
Larson’s son, Owen, and Kyle Busch’s son, Brexton, are both entered in the Shootout, rekindling a junior rivalry intensified after Brexton outpaced Owen in the previous year’s event. This intergenerational competition brings added electricity to an already charged gathering of experienced racers and aspiring talents. As Larson aims for the coveted Golden Driller trophy, the racing world watches to see if he can carry his victorious momentum across continents.
The Bigger Picture: Taxation, Racing, and the International Sports Landscape
Kyle Larson’s experience at the High Limits International places a spotlight on the complexities that international taxation rules impose on athletes competing abroad. For U.S. drivers, understanding such implications is vital, as tax deductions can significantly impact the final payout from overseas victories. Larson’s case specifically underscores how national athletic bodies, such as the Australian Tax Office, enforce regulations that ensure a portion of international earnings is retained within the country.
As the motorsports world continues its global expansion, with American stars like Larson proving their skills in international events, cross-border taxation remains a relevant concern. Larson’s journey from victory in Perth to the excitement of the Tulsa Shootout demonstrates both the rewards and the complications of international competition in modern auto racing.
