Canada · Guide
Are gambling winnings taxed in Canada?
No, not for most people. The Canada Revenue Agency treats winnings from casual gambling, such as casino games, sports bets and lotteries, as windfalls that aren't taxed and don't need to be reported. Winnings become taxable business income only if gambling is a business for you, which courts rarely find; in 2025 the Federal Court of Appeal did, for a professional poker player. Interest earned on your winnings is taxable, and prediction-market gains are treated differently.
Key takeaways
- The CRA lists lottery winnings among amounts that aren't reported or taxed, and its income tax folio treats casual gambling winnings as windfalls.
- Winnings can be business income, taxed in full, if gambling is a business: the CRA looks at organization, special knowledge, intent and frequency.
- Courts rarely find that: in Leblanc (2006), heavy, frequent sports-lottery betting was still a personal pursuit. In Fournier-Giguère (2025), the Federal Court of Appeal held that a professional poker player's winnings were business income.
- Losses work the same way: a casual gambler can't deduct them.
- Interest or investment income earned on your winnings is taxable, and prediction-market gains are usually capital gains or business income.
The short answer
If you play at an online casino or bet on sports for fun, your winnings aren’t taxed in Canada, and you don’t report them on your return. The Canada Revenue Agency (CRA) lists lottery winnings among the “amounts that are not reported or taxed”, unless they’re income from employment, a business or property, and its income tax folio on lottery winnings and miscellaneous receipts treats casual gambling winnings as windfalls: unexpected gains that aren’t income from a source.
That covers jackpots, sports bets, poker wins and lottery prizes alike, whether you win at a regulated Ontario casino, on PlayNow or at a provincial lottery.
When winnings become taxable
Winnings are taxable, in full, when gambling is a business for you. The CRA’s folio says it looks at factors such as:
- Organization: whether you gamble in a systematic, business-like way.
- Special knowledge or inside information that reduces the element of chance.
- Intention: whether you set out to earn a living from gambling.
- Frequency and the scale of your play.
The bar is high. In Leblanc v. The Queen (2006 TCC 680), which the CRA’s folio cites, the Tax Court found that heavy, frequent betting on sports lotteries wasn’t a business: gambling, even a lot of it, is usually a personal pursuit. Games of skill can be different. In Fournier-Giguère v. Canada (2025 FCA 112), the Federal Court of Appeal held that a professional poker player’s winnings were business income.
If you think you might be in business, talk to a tax professional before filing: business income is taxed in full, but business losses become deductible too.
Losses
Casual gambling losses aren’t deductible, for the same reason winnings aren’t taxed: they’re not part of a source of income. Only someone whose gambling is a business can deduct losses, against that business income.
What is taxed
- Investment income on your winnings. Interest, dividends or capital gains earned on money you’ve won are taxed like any other investment income.
- Prediction markets. Event contracts traded through a Canadian dealer are derivatives, not bets, and their gains are generally capital gains, or business income for frequent traders. Our guide to prediction market taxes explains.
- Gambling as a business, as above.
Keep records anyway
Even when winnings aren’t taxable, keep your account statements. Regulated sites show your transaction history in your account, and records help if the CRA ever asks where a large deposit in your bank account came from.
Before you count on winnings
Casino games and sports betting cost most players money over time; the tax treatment only matters on the occasions you’re ahead. Set a budget before you play, and if gambling stops being fun, every province has a free, confidential helpline in our guide to gambling help in Canada.
Frequently asked questions
Do I have to report casino or sports betting winnings in Canada?
Not if you gamble for fun. The CRA lists lottery winnings among the amounts that aren't reported or taxed, unless they're income from a business, and its folio S3-F9-C1 treats casual gambling winnings as windfalls.
Can I deduct gambling losses in Canada?
No, not as a recreational gambler: because casual winnings aren't income, casual losses aren't deductible. Only if gambling is a business are both the winnings taxable and the losses deductible.
When are gambling winnings taxable in Canada?
When gambling is a business for you. The CRA weighs the degree of organization, any special knowledge or inside information, your intention and how often you play; courts look at whether you're pursuing a living. Most frequent gamblers still don't meet that test, but professional poker players can, as the Federal Court of Appeal found in Fournier-Giguère v. Canada (2025).
Is the interest on my winnings taxed?
Yes. A big win isn't taxed when you receive it, but any interest, dividends or gains it earns once invested are taxable like any other investment income.
Are prediction market winnings taxed like gambling winnings?
Usually not. Event contracts traded through a Canadian dealer are derivatives, and their gains are generally treated as capital gains, or business income for frequent traders. See our guide to prediction market taxes.
Keep reading
Sources
We verify facts against primary sources (regulators, court records, operators’ own terms) wherever possible.
- Amounts that are not reported or taxed — Canada Revenue Agency , modified 2026-09-17
- Income Tax Folio S3-F9-C1: Lottery Winnings, Miscellaneous Receipts, and Income (and Losses) from Crime — Canada Revenue Agency , 2020-07-03
- With the growth of sports betting and prediction markets, how are winnings taxed? — The Globe and Mail , 2026-07-23