Taxes on Online Casino Winnings in Canada 2025: How to Save Safely Without CRA Issues
Online gambling is booming in Canada in 2025, with provinces like Ontario and British Columbia offering regulated platforms such as iGaming Ontario and PlayNow. But what happens when you hit a big win at an online casino? Do you owe casino winnings tax Canada? The good news: for most recreational players, gambling winnings are tax-free, thanks to paragraph 40(2)(f) of the Income Tax Act. The Canada Revenue Agency (CRA) treats these as a “windfall” — pure luck, not income.
That said, there are exceptions — especially for professional gamblers or if you earn interest on your winnings. In this casino winnings tax Canada guide we dive deep into the rules, province-specific differences (like provincial taxes gambling Ontario vs. Alberta), and practical tips to avoid CRA red flags. We’ve even included a simple tax calculator and reporting checklists.
Whether you’re a casual slot spinner or a blackjack pro, this guide helps you save safely and maximize your wins. Let’s get started!
Are Online Casino Winnings Taxable in Canada in 2025?
Short answer: No — not for recreational gamblers. The CRA does not tax gambling winnings from games of chance like slots, roulette, or lotteries, no matter the amount. This applies to both land-based and online casinos — including offshore sites that accept Canadians. Even a $100,000+ jackpot is 100% tax-free.
Why? Under CRA rules, these are “windfalls” — unpredictable strokes of luck, not earned income like a salary. This is very different from the U.S., where you face 30% withholding tax on wins over $1,200 USD.
Key Exceptions in 2025:
- Professional gamblers: If gambling is your main source of income (e.g., full-time poker pro), it’s treated as business income. Tax rate: 15–33% federal + provincial (up to 50%+ total). The CRA uses factors like frequency, skill level, and profit intent (see the Cranswick case).
- Interest on winnings: Put your winnings in a savings account? Interest over $50 triggers a T5 slip and is taxable as investment income.
- Foreign winnings: Win in the U.S.? You’ll pay 30% U.S. tax, but can claim a refund via Form 1040NR as a Canadian.
Pro Tip: Always track your transactions — the CRA can audit up to 6 years back.
CRA Rules: Amateur vs. Professional Gambler
The CRA divides gamblers into two categories. Here’s a clear breakdown:
| Category | Tax on Winnings? | Reporting Required? | Example | Federal Tax Rate 2025 |
|---|---|---|---|---|
| Recreational (Amateur) | No — tax-free windfall | No (unless interest) | Casual slot player, $5K/year in wins | N/A |
| Professional | Yes — business income | Yes, on T1 return; deduct losses | Full-time poker pro with $50K+ net profit | 15% (up to $55K) → 33% (over $246K) |
Source: CRA Income Tax Folio S3-F9-C1. Pros report via Schedule 3 (T3/T5/T5013 slips for interest/dividends). There’s no T5007 for gambling (that’s for stocks) — keep a gambling log to deduct losses.
How does the CRA classify you as a “pro”? Key factors:
- Frequency & volume (e.g., daily gambling)
- Skill-based games (poker > slots)
- Gambling as primary income (no day job)
- Recent case: Jonathan Duhamel won in court — poker ruled a “hobby” despite skill.
Casino Winnings Tax Calculator – for Canada
2025 Gambling Tax Estimator
Province-Specific Deductions & Rules: Ontario vs. Alberta 2025
The federal tax exemption applies nationwide, but pro gamblers pay combined federal + provincial taxes. No direct provincial tax on recreational winnings, but pros face varying rates. Here’s a unique comparison focusing on deductible expenses — like travel to casinos or software subscriptions.
| Province | Provincial Tax Rate for Pros (2025) | Deductible Expenses Example | Specific Rules | Description |
|---|---|---|---|---|
| Ontario | 5.05% (up to $51K) → 13.16% (over $246K); combined 20.05–46.16% | Losses, travel (e.g., to Niagara Falls), app subscriptions | iGaming Ontario reports wins >$13K within 15 days; T5 for interest | Ontario gambling tax 2025 |
| Alberta | Flat 10%; combined 25–43% | Full loss deduction, home office for online play | No provincial withholding; crypto winnings = income | Alberta casino winnings tax |
| Quebec | 15.5% (up to $51K) → 25.75% (over $119K); combined 30.5–50%+ | Losses, French-language software, travel to Casino de Montréal | Must file TP-1 return; crypto gains taxable | Taxe gains casino Québec 2025 |
| British Columbia | 5.06% (up to $47K) → 20.5% (over $253K); combined 20–53.5% | Losses, ferry costs to PlayNow, VPN fees | PlayNow reports large wins to CRA | BC online gambling tax |
Unique Insight: In Ontario, pros can deduct travel to regulated casinos (e.g., Fallsview) as a business expense — not allowed for amateurs. In Alberta, crypto gambling winnings are automatically treated as business income if you’re a pro — track wallet transactions!
How to Report Gambling Winnings to the CRA (If Needed)
Only pros or those with interest income need to report. Here’s a step-by-step:
- Keep a Gambling Log (Excel or app like Betting.gs):
- Date, game, amount wagered, amount won/lost
- Screenshots of casino dashboards
- File as Business Income (Line 13500–13900 on T1):
- Use Form T2125 (Statement of Business Activities)
- Deduct losses up to winnings (no net loss carryover)
- Interest on Winnings? → T5 slip from your bank if >$50
- Crypto Winnings? → Report as capital gains (50% taxable) or business income (100% taxable) depending on activity
Common Myths & FAQs
Do I need to report a $10,000 slot win?
No — recreational winnings are not reported. Only pros or interest earners file.
Can I deduct gambling losses?
Only pros — and only up to winnings. No carryover.
Are crypto casino winnings taxable?
winnings = tax-free, but selling crypto later = capital gains.
What if I win in Las Vegas?
Pay 30% U.S. tax, then claim refund via 1040NR. Canadian winnings stay tax-free!
Final Tips to Stay CRA-Compliant
- Never mix gambling and business funds — use a separate bank account.
- Save records for 6 years — the CRA loves audits.
- Use regulated casinos (e.g., BetMGM Ontario, PlayOlg) — they report large wins automatically.
- Consult a tax pro if winnings >$50K/year or you gamble full-time.
Last Updated: October 28, 2025 Sources: CRA Income Tax Act, iGaming Ontario Guidelines, Tax Court of Canada rulings
Ready to play tax-free? Check our Top 10 Tax-Free Casinos for Canadians 2025 → all regulated, fast payouts, and no CRA headaches.
Responsible Gambling: If you need help, call ConnexOntario at 1-866-531-2600.
