Are gambling winnings taxable in Canada? For most people, no. The Canada Revenue Agency (CRA) lists “lottery winnings of any amount, unless the prize can be considered income from employment, a business or property, or a prize for achievement” among the amounts you do not report. One exception matters most. Gambling carried on as a business is taxable, and on June 10, 2025, the Federal Court of Appeal confirmed that for three poker players.

The rule is federal, so it is the same in every province. This guide shows what the CRA says, where the answer stops and what does not follow from it. It gives general information and is not tax or legal advice.

Are gambling winnings taxable in Canada? What the CRA says

The CRA keeps a page called Amounts that are not taxed, last modified on September 17, 2026. It says you do not have to report “lottery winnings of any amount”, with the exceptions quoted above. There is no form, line or deadline for a one-time win, because there is nothing to report.

The page names lottery winnings. It does not say in terms that casino, sports betting or poker winnings are treated the same way. That reading comes from the CRA’s income tax folio, covered in the next section, so this guide does not present it as a quotation from the page.

This applies across the country. The CRA administers income tax for all of Canada, so the answer does not change between Ontario and Alberta or any other province. Regulation is what differs by province, and who regulates online gambling in each province covers that side. Quebec has its own return with Revenu Québec, and its page on taxable and non-taxable income lists lottery winnings among the amounts left out. The answer is the same.

Where does the rule come from?

Two documents set out the rule. The first is paragraph 40(2)(f) of the Income Tax Act. It sets the gain or loss at “nil” on a chance to win a prize or bet, and on a right to receive a prize or winnings on a bet, when these relate to the lottery schemes and betting pools the paragraph describes. The Justice Laws text is current to September 21, 2026.

The paragraph speaks of lottery schemes and pool betting. The sources cited here do not say that it also covers a bet on a single event or an online casino game, so for those the guide relies on the general rule about business income, covered below.

The second is Income Tax Folio S3-F9-C1, Lottery Winnings, Miscellaneous Receipts, and Income (and Losses) from Crime, in effect since July 3, 2020. Paragraph 1.2 says “an amount received as a windfall is not subject to tax”. Windfall is the CRA’s own word. The folio lists factors that point to a windfall, among them that “the taxpayer made no organized effort to receive the payment” and that “the taxpayer had no reason to expect the payment would recur”.

Are lottery winnings taxed?

Not as a rule. The CRA page says “of any amount”, so no threshold exists above which a win is taxed. Paragraph 1.16 of the folio is direct: “The amount or value of a prize received by a taxpayer from a lottery scheme is not taxable as either a capital gain or income.”

According to BCLC, British Columbia’s lottery corporation, “Canadian tax authorities do not treat lottery, casino, bingo and eGaming prizes as taxable income, as they are considered to be windfalls”. BCLC adds that tax implications may arise if a prize is paid as an annuity or taken out of province or country.

The exceptions are few. The folio says a contest run by an employer in place of a bonus “is not a lottery”, and that the prizes “are considered to be employment income”. Retailers are another case: “Lottery ticket retailers who sell winning tickets must include in their income the amount or value of any prize commissions”.

A prize that is not cash adds one step. The winner “is deemed to have acquired the prize at a cost equal to its fair market value at the time of acquisition”, so a later sale raises a question only about any increase in value since the win.

A warning is in order. The Canadian Anti-Fraud Centre (CAFC) describes a prize scam in which the supposed winner is told “to pay a small fee to cover taxes, legal fees, or delivery costs”. Its page says: “No winnings are ever received.” That is how the CAFC describes prize scams. A request to pay tax in advance on a prize is a warning sign.

When does gambling count as a business?

The folio says in paragraph 1.12: “An individual’s gambling activities may result in taxable business income or a business loss.” It also notes: “However, gambling is always undertaken in pursuit of profit.” Profit as a motive is not enough on its own.

What the CRA looks at. Paragraph 1.15 calls the question “a question of fact that can be determined only by an examination of all of the circumstances”, and says “no single factor may be conclusive”. The folio lists four things to weigh:

  • “the degree of organization that is present in the pursuit of this activity by the taxpayer”
  • “the existence of special knowledge or inside information that enables the taxpayer to reduce the element of chance”
  • “the taxpayer’s intention to gamble for pleasure as compared with any intention to gamble for profit as a means of gaining a livelihood”
  • “the extent of the taxpayer’s gambling activities, including the number and frequency of bets”

Frequency alone does not settle it. The folio quotes the Tax Court of Canada in Leblanc: “Gambling - even regular, frequent and systematic gambling - is something that by its nature is not generally regarded as a commercial activity except under very exceptional circumstances.”

The courts have decided cases in both directions. In Leblanc v. The Queen, 2006 TCC 680, decided on December 21, 2006, brothers had bet on government sports lotteries between 1996 and 1999, for millions of dollars a year. The court concluded that “their gambling activities were of a personal nature. Accordingly, their winnings are not business income”.

In Cohen v. The Queen, 2011 TCC 262, decided on May 12, 2011, a lawyer who played poker full time claimed a business loss of $121,991.43 for 2006. The judge found that he had not shown that he conducted his venture as a business, and the loss was not accepted.

In Duhamel v. The Queen, 2022 TCC 66, decided on June 21, 2022, the appellant had won the World Series of Poker Main Event in 2010. The court held that his poker activities “were not carried on in a sufficiently commercial manner to constitute a source of business income”, and his poker earnings were not taxed as business income for 2010, 2011 and 2012.

The next case had the opposite result. In Fournier-Giguère v. Canada, 2025 FCA 112, decided on June 10, 2025, the Federal Court of Appeal dismissed three appeals. The poker income of the three players, for years between 2008 and 2012, remained taxable as business income. The court wrote that purely recreational income is not taxed but may become so when the activity is undertaken “in a ‘sufficiently commercial manner’”. It added: “Ultimately, it will depend on the circumstances of each case.”

One point needs care. The Tax Court found that poker combines luck with skill, and that which of the two prevails did not decide whether the players were running a business. The Federal Court of Appeal dismissed the appeals. It did not rule that poker is a game of skill, and this guide does not call the result final.

“Professional gambler” is therefore not a status that a person picks. It is the label that follows when the CRA or a court weighs the facts, and the facts can point either way.

Can you deduct gambling losses?

Generally not. For the lottery schemes and betting pools it covers, the same paragraph 40(2)(f) that leaves a win out treats the “gain or loss” as “nil”. The folio explains the logic for hobbies: “neither amounts received nor expenses incurred are included in the income computation for tax purposes”, and an excess of expenses is “a personal or living expense”. It mentions a “business loss” only where gambling is a business, and Cohen shows that even full-time play did not meet that test in one case.

The two sides go together. A win is not reported, and a loss is not claimed. Nobody should read the first half as an advantage of gambling.

If your losses add up to more than you expected, help is available. In Ontario, ConnexOntario offers free and confidential support at 1-866-531-2600. In Alberta, you can call the Alberta Health Services Addiction Helpline at 1-866-332-2322. Other provinces run their own services, and tools and support for safer gambling collects ways to keep gambling in check.

What is taxed after a win?

What the winnings earn afterward is taxed, as the CRA page puts it: “Income earned on any of the above amounts is taxable. For example, any interest that you earn when you invest lottery winnings must be reported on your return.”

The prize is one thing, and the money it later earns is another. Revenu Québec makes the same point for interest on lottery winnings. A non-cash prize that is sold at a higher value follows the rule described earlier.

What if you win in the United States?

The answer changes here. U.S. rules govern the win at its source, and the Canadian rule governs your Canadian return.

The Internal Revenue Service (IRS) explains the U.S. side in Publication 515 (2026): “In general, nonresident aliens are subject to chapter 3 withholding at 30% on the gross proceeds from gambling won in the United States if that income is not effectively connected with a U.S. trade or business and is not exempted by treaty.” It also says: “No tax is imposed on nonbusiness gambling income a nonresident alien wins playing blackjack, baccarat, craps, roulette, or big-6 wheel in the United States.” Canada does not appear on the publication’s list of treaty countries whose residents are exempt.

The tax treaty adds a rule on losses. Article XXII, paragraph 3 of the Canada–United States Tax Convention says that losses on wagering transactions are deductible, for the purpose of taxation in the other state, to the same extent as for a resident of that state.

IRS Topic no. 419, updated on September 24, 2026, says a non-resident “must use Form 1040-NR, U.S. Nonresident Alien Income Tax Return along with Schedule NEC (Form 1040-NR)” to report gambling winnings, and that to deduct losses a person must “keep an accurate diary or similar record of your gambling winnings and losses”.

Now the Canadian side. In a page last modified on January 20, 2026, the CRA says: “If you received US lottery or gambling winnings, do not report this income on your Canadian income tax return as this income is not taxable in Canada. Additionally, you cannot claim a credit for any taxes withheld on these winnings.”

The steps for recovering withheld tax, the deadlines and the treatment of slot jackpots are not covered in the sources cited here. A cross-border tax professional or the IRS can answer them.

Does it matter where the site is registered?

This is where the CRA is silent. The CRA page and the folio cited here draw no line between a site registered in your province and one that is not, and neither says in terms that the same treatment applies to both. This guide does not fill that gap.

The nearest statement in the folio, in paragraph 1.11, concerns profits from bookmaking or from operating a gambling establishment. That is about the operator, not the person who wins.

Tax is one question and protection is another. A complaint can only go further if there is a regulator to take it to. How registration works in Ontario is explained in how to check whether a site is registered in Ontario, and the position in Alberta in what changed for online gambling in Alberta in July 2026.

What this means in practice

The table sums up each situation as the sources above describe it. It is a summary, not advice on any one case.

SituationTaxed in Canada?Source
Lottery win of any amountNot reportedCRA, amounts not taxed
Occasional casino, sports betting or poker winNot taxed, unless business incomeFolio ¶1.12, ¶1.15
Gambling carried on as a businessTaxable business incomeFolio; 2025 FCA 112
Interest earned on winningsTaxableCRA, amounts not taxed
Employer contest in place of a bonusEmployment incomeFolio ¶1.25
Win in the U.S.Not reported in Canada; U.S. tax may be withheldCRA; IRS Pub. 515

Where to ask and where to get help

Are gambling winnings taxable in Canada in your case? That depends on the facts, and a guide cannot supply them. The CRA or a tax professional is the place to ask. A message that asks for money before a prize is paid out can be reported to the CAFC.

If gambling is affecting you or someone you care about, you do not have to wait until it becomes serious. In Ontario, ConnexOntario offers free and confidential support at 1-866-531-2600. In Alberta, you can reach the Alberta Health Services Addiction Helpline at 1-866-332-2322, with more at Alberta Health Services. Other provinces have their own helplines.

Common questions about tax on gambling winnings

Are gambling winnings taxable in Canada, and do you have to report them?

For lottery winnings, the CRA says you do not have to report them, whatever the amount, unless the prize is income from employment, a business or property, or a prize for achievement. Gambling carried on as a business is the main exception, and interest earned on winnings must be reported.

Are gambling winnings taxable in Canada above a certain amount?

The CRA’s wording is “of any amount”, so no threshold is set for lottery winnings. The nature of the income decides the matter, not its size. A prize that is employment, business or property income, or a prize for achievement, is treated differently, and so is gambling run as a business.

Are casino and sports betting winnings taxed the same way as lottery winnings?

The CRA page names lottery winnings. For gambling more broadly, the folio says it may result in taxable business income or a business loss, so the question becomes whether the activity is a business. A bet on a single event is not addressed separately in the sources cited.

Do professional poker players pay tax in Canada?

It depends on the facts. On June 10, 2025, the Federal Court of Appeal dismissed appeals by three players whose poker income for years between 2008 and 2012 had been treated as business income. In 2022, the Tax Court reached the opposite result in Duhamel. Each case turns on its circumstances.

Can you deduct gambling losses on your tax return?

Generally not. For the lottery schemes and betting pools it covers, paragraph 40(2)(f) treats the gain or loss as nil, and the folio calls the excess of hobby expenses a personal or living expense. It mentions a business loss only where gambling is a business. In Cohen, a lawyer who played poker full time in 2006 did not succeed.

Is interest earned on lottery winnings taxable?

Yes. The CRA page says that income earned on non-taxed amounts is taxable and gives interest on invested lottery winnings as its example. Revenu Québec makes the same point for interest on lottery winnings.

Do Canadians pay tax on winnings from a U.S. casino?

The CRA says not to report U.S. lottery or gambling winnings on your Canadian return, as the income is not taxable in Canada. The U.S. side differs: IRS Publication 515 describes 30% withholding for non-residents, and Canada is not on its list of exempt treaty countries.

Can you claim U.S. tax withheld on gambling winnings on your Canadian return?

No. The CRA says you cannot claim a credit for any taxes withheld on these winnings. IRS Topic no. 419 describes reporting gambling winnings on Form 1040-NR. This guide does not cover the steps or deadlines, and a cross-border tax professional or the IRS can answer them.

Sources