Canadian Casino Reviews
What You Need to Know About Taxes on Casino Winnings
It is important to be able to categorize your taxable and non-taxable income when you are handling your personal finances. If you are concerned about owing money to the Candian government if you have won money from a casino, whether it was a large small sum, you do not need to worry. Under most circumstances, your gambling winnings are not taxable. Your money is yours to do with as you please.
Why aren't Casino Winnings Taxable?
In Canada, your winnings are not seen as taxable, because the income is based on luck, rather than an expectation from a normal job or business. These laws originated from the principles of the British Common Law and can be found under 40(2) (f) of the Income Tax Act. There are many houses where you can play tax-free so make sure that you look out for them if you feel more comfortable gambling there.
Does this Apply to Both Online and Land Casinos?
Yes! There are no taxes on casino winnings whether they are online or in a brick and mortar casino. It is always a good idea to read up on the licenses that online and land casinos have, for you to better understand the laws under which your money and gambling activities are subjected.
When Would I Have to Pay Taxes on Casino Winnings?
You are subject to paying taxes on casino winnings if you are a professional gambler and you must declare gambling winnings if they are a gift from a gambling win.
If you are a professional Canadian gambler meaning that you gamble online or offline and it is how you earn your living, there will be taxes on casino winnings. Being a professional is not simply, playing and winning often, but it means that you have a systematic application of skills that create a business or consistently turn over a profit. This is seen as a freelance business, and the Canada Revenue Agency is responsible for auditing persons whose source of income is from gambling.
Just like any other business, you can deduct losses from your taxes and you pay based on the tax bracket under which you fall. You must note that even if you win money at a tax-free casino as a professional gambler, you are still required to pay taxes on what you earn and it must be reflected when you file your taxes.
Do Canadian Citizens Have to Pay Taxes on Casino Winnings in the US?
If you decide to move your gambling to the US as a Candian citizen, be warned. You will be subject to the taxes on casino winnings based on the laws of the United States. Once you have won over $1200 USD, you are subject to paying taxes which can cut a hole in your earnings. The taxes are taken out before you receive your winnings, so there is no way out of it.
No matter where you are in the world, make sure you are aware of the laws and taxes associated with gambling to avoid any legal or tax issues. But if you are in Canada, hop on to your favorite casino and enjoy your tax-free gambling!