Fact Checked by 
If you have won money gambling or are planning on gambling and hopefully winning some money, you’re probably wondering, “Are gambling winnings taxable in Canada?” If so, this guide is for you.
Here, we explain the Canada gambling tax laws and rates for gambling-related activities, both federally and provincially. So, keep reading to find out whether or not you need to pay tax on your winnings from the casino, track, sportsbook, lottery, or poker table.
How Gambling is Taxed in Canada
In Canada, gambling winnings are typically tax-free because they are not considered regular income. The Government only taxes people for money made from employment, property, and other designated sources – gambling winnings do not fall under any of these in most cases.
When You Need to Pay Gambling Tax in Canada
As stated above, there isn’t usually any tax on gambling winnings in Canada, but this is just for recreational gamblers. If you are classed as a professional gambler, then any winnings you make gambling are subject to federal and provincial taxes.
Joe YarnoldCasino & Betting Expert
What to Declare When it Comes to Tax on Gambling Winnings in Canada
Because casual gamblers aren’t required to pay any lottery, sports betting, horse racing, poker, or casino winnings tax in Canada, there is no need to declare any of it on their tax forms.
However, if you use your gambling winnings to invest, you must declare any additional earnings you make from these investments using the appropriate forms, such as the T3, T5, and T5013 forms, depending on what your investments were.
For example, if you won $50,000 on a scratchcard, you then invested that money into stock and made $1,000 in dividends and $5,000 in capital gain. You would need to report this $6,000 but not the original $50,000 gambling winnings.
For professional gamblers, there is a tax on poker, horse betting, and sports betting, as well as a tax on casino winnings in Canada. Professional gambling is considered a business, and any winnings need to be reported as self-employed income.
Professional Gamblers & Taxation
The only time there are taxes on gambling winnings in Canada is if the player is a professional gambler, but what is a professional gambler? The Canada Revenue Agency (CRA) assesses each case individually and looks at the totality of the circumstances rather than having one sole defining factor. Key factors they consider include:
- If gambling is the primary source of income.
- The degree of organization involved in gambling: This could include keeping detailed records of wins and losses, employing strategies, and managing travel expenses to go and gamble specifically.
- The existence of any special knowledge or inside information.
- The person’s intention – whether they are gambling for entertainment or solely for profit.
- The frequency and number of bets placed.
As you can see, there is nothing about the amount of money won, so recreational gamblers who hit it big while wagering on casino sites, the lottery, or from a winning sports bet aren’t automatically classed as professionals. However, a big win is likely to draw more scrutiny, and the CRA is more likely to investigate whether you should be classified as a professional.
It’s important to note that poker winnings are taxable in Canada but still only for professionals. However, as poker is considered a game of skill, if you are winning regularly and winning a fair amount of money, you are more likely to be classified as a professional gambler.
If you are deemed to be a professional gambler, you are taxed on your winnings as if they were income. This means you are required to pay federal taxes anywhere from 15% to 33%, depending on the total amount won over a tax year, plus your provincial taxes.
Are Gambling Losses Tax Deductible in Canada?
For recreational gamblers, gambling winnings are tax-free, and gambling losses are not tax-deductible. This includes any losses from lotteries, sports betting, poker, and casino games.
Professional gamblers, on the other hand, can deduct losses because casino winnings are taxable in Canada for them. Losses are only deductible up to the amount of your gambling winnings. This means that if you’ve made a loss for the year gambling, you can’t deduct the losses from any other form of income other than gambling, such as a salary or investments.
In addition to deducting gambling losses, professional gamblers can deduct travel expenses related to gambling, such as to a tournament, entry fees into competitions, research, and training, as well as specific home expenses, such as a computer for online gambling.
However, you should note that it’s essential to keep detailed records of all your gambling-related transactions, wins and losses, and expenses to be able to prove your losses to the CRA.
How Taxes on Casino Winnings in Canada Differ Per Province
We have answered the question, “Do you pay taxes on gambling winnings in Canada?” and discussed Federal tax rates for gambling, but anyone considered a professional gambler must pay additional provincial taxes. Each province’s tax information is below and verified as of 2024.
Alberta
Alberta is one of the kinder provinces for professionals. It has five brackets ranging from 10% to 15%. The lowest bracket, 10%, applies to the first $148,269 in earnings, and the highest bracket, 15%, applies to earnings over $355,845. This applies to Calgary, online casinos, and all other areas of Alberta.
British Columbia
British Columbia offers appealing tax rates for those earning under $100,000, but it has the third-highest rate for high earners. There are seven brackets in total; the lowest tax rate is 5.06% and applies to earnings between $0 and $47,937. The highest rate is 20.5%, and this is for earnings over $252,752.
Manitoba
Manitoba keeps things relatively simple with just three tax brackets. Earnings between $0 and $47,000 are taxed at 10.8%, and earnings between $47,001 and $100,000 are subject to 12.75%. The maximum tax bracket is 17.4%, and in 2024, its threshold for anything over $79,625 will be increased to $100,000. However, it will return to the previous amount in 2025.
New Brunswick
New Brunswick changed its tax rates slightly in 2024. There are now four brackets: 9.4%, 14%, 16%, and a maximum of 19.5%. The minimum amount applies to the first $49,958, and the maximum rate applies to earnings of $185,064 and above.
Newfoundland and Labrador
Newfoundland and Labrador have eight brackets and a reasonably large spread. The minimum tax is 8.7%, which applies to earnings up to $43,198. The next level increases substantially to a 14.5% tax on earnings over $43,198 and up to $86,395.
There is then a fairly steady percentage increase for each bracket up to the maximum of 21.8%, which applies to earnings over $1,103,478.
Nova Scotia
After Quebec, Nova Scotia residents, on average, pay the largest amount of tax. There are five brackets in total, with the minimum tax rate of 8.79% of earnings up to $29,590. There’s then a 6.16% increase to 14.95% for earnings over $29,590 up to $59,180. The maximum tax bracket is a 21% rate for all income over $150,000.
Ontario
Ontario has the lowest maximum tax rate in the country. There are five personal provincial tax brackets. The first $51,446 is taxed at 5.05%, and the maximum is 13.6% for earnings over $220,000.
Prince Edward Island
Up until 2023, Prince Edward had just three brackets, but this was increased to five in 2024, and the tax was increased by an indexation factor of 1.047 (an average of 4.7% increase). The minimum rate is 9.65% on the first $32,656, and the maximum rate is now 18.75% on any amount over $140,000.
Quebec
Quebec residents have the highest tax burden of all Canadian provinces. Combined with Federal taxes, high earners can pay up to 53.3% in total tax. There are four tax brackets here, ranging from a minimum of 14% for earnings up to 51,780 to a maximum rate of 25.75% for anything over 126,000.
Saskatchewan
Saskatchewan has only three tax brackets, like Manitoba and a few other provinces. Residents pay 10.5% on the first $52,057, 12.5% on anything up to $142,057, and 14.5% on anything upwards of $142,057.
Do You Get Taxed on Lottery Winnings in Canada?
Unlike winnings from poker, casinos, and sports betting, the answer to ‘Do you get taxed on lottery winnings in Canada?’ is no for both recreational and professional gamblers. Winning lottery games is entirely luck-based; therefore, all funds from this are considered windfalls.
This rule extends to lottery-style games, including both physical and online scratch cards. However, if you make winnings from online scratch cards on accounts where you play skill-based games, make sure to keep a detailed record and evidence to prove that the money came from winning on the scratch card rather than another source.
Are Sportsbooks Taxed in Canada?
Again, the answer to “Are sports betting winnings taxable in Canada?” is no for the majority of people. For recreational bettors, such as those who enjoy wagering occasionally on online betting sites, there are no taxes on sports betting in Canada as they count as a windfall gain and are, therefore, not considered income and not taxable.
For professional gamblers, though, sports betting taxes in Canada must be paid. Any winnings are classed as standard income and are taxed accordingly. The tax rate depends on your total profit from gambling over the year and the province in which you live.
ReadWrite’s Final Say
If you are classed as a professional gambler, your winnings count as income and are subject to federal and provincial tax. To be classified as a professional gambler, the CRA will look at several factors. These include whether gambling is your primary source of income, frequency of betting, motivation for gambling, and skill level.
Now that you know more about taxes on casino winnings in Canada, you can rest easy when you decide to gamble online. The next time you’re looking for an online casino with generous rewards and loads of entertaining games, we recommend paying a visit to Instant Casino.
Other Useful Guides for Canadian Gamblers
FAQ
Can you write off gambling losses in Canada?
Does prize money count as income in Canada?
What amount of income is not taxable in Canada?
Are gambling winnings taxable in Canada?
Responsible Gambling
Now that you know the answer to “Are gambling winnings taxable in Canada?”, you’re probably feeling more confident about gambling online. However, you should remember that gambling can be addictive and lead to issues such as depression and financial strain.
This is why it’s so important to always practice responsible gambling. If you’d like to learn more about responsible gambling and the resources available to those struggling, we recommend visiting the sites below.
