Are Online Poker Winnings Taxable In Canada



10 Nov 2010, 12:56pm
Canada Revenue AgencyIncome Tax: IRSUS Tax
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This is a discussion on Legality of Online Poker Winnings within the online poker forums, in the Online Poker section. I live in Canada and all lottery/gambling wins are tax free. Online gambling was legalized in 2008, but detailed regulations weren’t set until 2012. Official Bulgarian gambling sites were introduced in 2013 along with a new tax on turnover for online casino operators. Online gambling winnings in Bulgaria are tax-free, just like with land based casinos there.

Income Tax on World Series of Poker Winner

Taxable
  1. All winnings either online or offline are tax free! Any betting tax abolished in 2001 by Gordon Brown. Tax used to be on bookies but they passed to punters. Bookmakers must now pay 15% POI tax but not punters. POI tax on any games of chance increased from 15% to 21% but again not for punters.
  2. Contest prizes and winnings from lotteries or gambling are not taxable in Canada, so this type of income does not have to be reported on your Canadian tax return, unless of course you are engaged in the business of gambling.
  3. Are Online Poker Winnings Taxable In Canada, dr sean slotar, biggest casino in shrevepor, blackjack payout casino.

You probably heard from any of your favourite Canadian news sources that Jonathan Duhamel, 23 year old from Canada has won the World Series of Poker in Las Vegas. The winning awards him US$8.9 million in prize money.

Unlike the Vancouver Lotto Jackpot winners, who don’t have to pay any income tax on their $50 million winning, Duhamel, will have to pay tax in USA, Canada and his province of residence. There have been interesting developments in tax on Poker winnings in Canada for last few years.

An increasing number of Canadians are playing online poker regularly and winning. To begin with, lottery and gambling winnings in Canada are not subject to income tax, as I mentioned in my previous post, since these income are not from an “income from a source” of employment, business or investment income.

Are online poker winnings taxable in canada 2020

This all changes when Poker or Gambling winning becomes a source of income from a running a business. If you spend a significant amount of time, playing poker, spend a substantial amount of money for playing poker and pay for your living expenses from your poker winning you are in a business and you must report your income from playing poke to Canada Revenue Agency. Canada Revenue Agency can decide if your poker winnings are taxable or not by reviewing taxpayer’s poker playing habit.

Regarding Jonathan Duhamel’s winning, he won in a professional poker tournament that makes his winning taxable both in Canada and USA. Since he won the prize money in USA, he will get the prize money after tax. If he has a Social Security number, he can get all the winning but he will have to report the winning in his USA tax filing and pay tax on the winning.

Since he is a Canadian citizen, and assuming he does not have a US Social Security no., he will get his prize money after 30% tax deduction by IRS. He will have to request for a US non resident Tax Payer Identification (TIN) no. and file a US tax return and could get some of the tax deduction back from IRS.

In Canada, he will have to report his winning in his Income Tax Return and also the taxes that he has paid in USA. Since Canada and USA have income tax treaty, he will get credit for taxes paid on his winning in USA and will pay a smaller amount of Tax to the Federal Government. Then the Province of his residence will come after him for their share of Dhuamel’s winning.

After doing a rough calculation, he is expected to net $4.6 million after tax from his $8.9 million prize winning.

I am assuming that he will claim that he is not a professional poker player, to avoid reporting his income in Canada. So far, all the news I have reviewed about Jonathan Duhamel, I don’t think his claim is going to fly over CRA. His Tax Advisors will have a hard time to prove that he is not a professional poker player.

Bloomberg news reported that there is an evilcpa, and Las Vegas poker players bring her to keep their poker winnings from IRS’s tax grab. Jonathan Duhamel should seek her help too.

Are Online Poker Winnings Taxable In Canada

Are Online Poker Winnings Taxable In Canada 2020

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