Are gambling winnings taxable in Canada?
For most Canadians, casino and lottery winnings are not taxed. The exceptions are interest you earn on the money, gambling run as a business, and gains on crypto you play with.
Short answer
No, for recreational players. The CRA does not tax winnings from lotteries or casual gambling, and you do not report them. Three things are taxed: interest or other income you earn by investing the winnings, gambling that is so organized it counts as a business, and gains on crypto-assets you deposit or withdraw. US gambling winnings are not taxable in Canada, but tax the US withholds is not credited back.
The CRA’s position
The CRA sets out its view in Income Tax Folio S3-F9-C1, Lottery Winnings, Miscellaneous Receipts, and Income (and Losses) from Crime. Two paragraphs matter most:
- Paragraph 1.16: a prize from a lottery scheme is not taxable as a capital gain or as income, unless the circumstances make it income from employment, business or property, or a prize for achievement.
- Paragraph 1.13: gambling, even regular, frequent and systematic gambling, is by its nature not generally regarded as a commercial activity, except in very exceptional circumstances.
The CRA’s page on amounts that are not reported or taxed lists lottery winnings “of any amount”. A C$500 slot win and a C$5 million jackpot get the same treatment.
When gambling becomes a business
Paragraph 1.15 of the folio lists the factors the CRA weighs. None decides the question alone:
- the degree of organization, as in a business;
- special knowledge or inside information that reduces the element of chance;
- whether you gamble for pleasure or as a way to earn a living;
- the number and frequency of bets.
If gambling is a business, the profit is taxed as business income and the losses of that business can be deductible (paragraph 1.12). Most players never come close: games of pure chance such as slots and roulette give no skill edge to organize a business around.
What the courts have said
| Case | What happened | Result |
|---|---|---|
| Leblanc v. The Queen, 2006 TCC 680 | Two brothers bet very large sums on provincial sports lottery tickets, systematically. The CRA said it was a business. | Not a business. The Tax Court cited the general rule that gambling is not commercial. The CRA now quotes this case in the folio. |
| Luprypa v. The Queen, [1997] 3 CTC 2363 | A skilled pool player won money from bar patrons he played against. | Taxable. His skill took most of the chance out of the bets. |
| Balanko v. M.N.R., [1981] CTC 2977 | Cited by the CRA on the role of intent. | The CRA relies on it for the point that intent to earn a living matters. |
The pattern: games of chance, played by a person with another job, stay tax-free even when the amounts are large. Skill games where one player has a clear edge, played as a livelihood, can be taxed. Poker professionals sit near that line.
Interest and other income earned on winnings
The win itself is tax-free. What it earns afterwards is not. The CRA says income earned on non-taxable amounts is taxable, and gives the example that any interest you earn when you invest lottery winnings must be reported.
Example: you win C$100,000 and put it in a savings account at 3%. The C$100,000 is not reported. The C$3,000 of interest is reported as investment income for that year. If you buy shares and later sell at a gain, that is a capital gain, taxed in the normal way.
Crypto at the casino
Crypto adds a tax step the win does not have. The CRA treats these as dispositions of a crypto-asset:
- trading or exchanging it for government-issued currency or another crypto-asset;
- using it to buy goods or services;
- giving it away.
Moving crypto between wallets you own is not a disposition. So when you exchange crypto for casino chips, or sell the crypto you withdrew, you may have a capital gain or loss: the difference between the value at that moment and what the crypto cost you (your adjusted cost base). Generally half of a capital gain is taxable. If your crypto trading looks like a business (frequent trades, short holding periods, borrowed money), the whole gain can be business income.
Example: you buy 0.01 BTC for C$800 and later deposit it at a casino when it is worth C$1,000. You have disposed of it at C$1,000, a C$200 capital gain, whatever happens at the tables. Keep the date, amount and Canadian-dollar value of every crypto transaction. See our crypto payments guide.
US casino winnings: a contrast
The United States taxes gambling winnings of non-residents. IRS Publication 515 says winnings of non-resident aliens are generally subject to 30% withholding unless a tax treaty provides otherwise.
On the Canadian side, the CRA says US lottery or gambling winnings are not taxable in Canada and should not be reported, and that you cannot claim a credit for any US tax withheld on them.
Records worth keeping
- Casino transaction history (deposits, withdrawals, dates).
- Bank statements showing withdrawals received.
- For crypto: purchase price, dates, wallet addresses and the Canadian-dollar value at each deposit and withdrawal.
- Any US tax forms if you won in the United States.
Large deposits can prompt questions from your bank. A casino withdrawal record is the simplest answer.
FAQ
Do I have to report casino winnings on my tax return?
Not if you are a recreational player. Report the interest or investment income you earn on the money later.
Can I deduct gambling losses?
Not as a recreational player. Losses are deductible only if your gambling is a business, and then your profits are taxable too.
Is online poker income taxable?
It depends on the facts. A recreational player is not taxed. A player who plays as a livelihood, with skill that reduces chance, can be. Get professional advice if poker is your main income.
Does Quebec tax gambling winnings differently?
Are crypto casino winnings taxable?
The gambling win follows the normal rules. Exchanging or selling the crypto can create a capital gain or business income, separately from the win.
This page is general information, not tax advice. For your own situation, ask a tax professional.
Sources
- CRA: Income Tax Folio S3-F9-C1, Lottery Winnings, Miscellaneous Receipts, and Income (and Losses) from Crime (checked November 3, 2026)
- CRA: Amounts that are not reported or taxed (checked November 3, 2026)
- CRA: Reporting income from crypto-asset transactions (checked November 3, 2026)
- CRA: Canadian residents going down south (checked November 3, 2026)
- IRS: Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities (checked November 3, 2026)