Canadian Tax on Poker???

[Rebel88]

I was looking through the act respecting income tax for Canada and came across this:

Income not taxed

It is interesting to note what is not taxed in Canada. The following list is not comprehensive:
• gifts and inheritances;
• lottery winnings;
• winnings from betting or gambling for simple recreation or enjoyment;

My question is, to anyone with knowledge on the subject, what differentiates a gambler of simple recreation or enjoyment to a "pro"? Is it a monetary amount, if so what is the limit? If poker is you're sole means of income in Canada do you have to pay tax on it according to the law. I could not find anything in the act regarding gambling tax other than that of recreational play.

[JavaNut]

If your sole income is from poker or even only a significant part of your income is from poker, how can you possibly construe this to be only recreational?

If you need a more specific answer than that, you simply have to look into the verdicts from tax courts and regular courts in canada, those are published in collections that you will be able to find at libraries, problably only in canada though.

You will not be able to get a specific amount as the limit between recreational and non-recreational play, the words has deliberatly been chosen like that to make it depend on your total income and your way of life, so to speak, and not a fixed amount or even a fixed percentage of your total income.

[orig!naL]

I don't think you would have to pay tax on it, as the law is. Canadians win lotteries for multiple millions and don't pay a cent in income tax on the winnings. If you can get away with that, I don't see how they can tax you on other gambling/lottery winnings.

[SlightlyMad]

There are already two large threads on this topic.

Here's the last one from Poker Legislation:Taxes in Canada? (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Number=9817812&page=0&fpart=1&v c=1)

And, probably the more famous one from Internet Gambling:Canadian Online Poker Tax Thread (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Number=1095183&page=0&fpart=1&v c=1)

Hope this helps.

[Rebel88]

[ QUOTE ]
There are already two large threads on this topic.

Here's the last one from Poker Legislation:Taxes in Canada? (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Number=9817812&page=0&fpart=1&v c=1)

And, probably the more famous one from Internet Gambling:Canadian Online Poker Tax Thread (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Number=1095183&page=0&fpart=1&v c=1)

Hope this helps.

[/ QUOTE ]

Thanks that's exactly what I was looking for!

[JavaNut]

[ QUOTE ]
I don't think you would have to pay tax on it, as the law is. Canadians win lotteries for multiple millions and don't pay a cent in income tax on the winnings. If you can get away with that, I don't see how they can tax you on other gambling/lottery winnings.

[/ QUOTE ]

If you read the lihnks put in about other threads on this topic you might find out that you are quite wrong in assuming that lottery winnings and poker/gambling winnings are considered the same or you could just read what OP actullay stated about Canadian law:

[ QUOTE ]
It is interesting to note what is not taxed in Canada. The following list is not comprehensive:
• gifts and inheritances;
• lottery winnings;
• winnings from betting or gambling for simple recreation or enjoyment;


[/ QUOTE ]

Lottery winnings are unconditionally a non tax item, but poker is only if recreational/enjoyment.

[Fredpower]

[ QUOTE ]

Lottery winnings are unconditionally a non tax item, but poker is only if recreational/enjoyment.

[/ QUOTE ]

where did you see it in the income tax act, I dont see that

[JOHNY CA$H]

Gambling Profits

10. Profits derived from bookmaking or from the operation of any gambling
establishment (carried on legally or otherwise) constitute income from a
business. In addition, an individual may be subject to tax on income derived
from gambling itself, if the gambling activities constitute carrying on the
business of gambling; see the decision of MNR v. Morden, (1961) CTC 484, 61
DTC 1266 (Ex. Ct.). The issue of whether or not an individual's activities are
such that he or she can be considered to be carrying on a gambling business is
a question of fact that can be determined only by an examination of all of the
circumstances and the taxpayer's entire course of conduct. Although no one
factor may be conclusive, the following criteria should be considered in
making the determination:

(a) the degree of organization that is present in the pursuit of this activity
by the taxpayer,
(b) the existence of special knowledge or inside information that enables the
taxpayer to reduce the element of chance,
(c) the taxpayer's intention to gamble for pleasure as compared with any
intention to gamble for profit as a means of gaining a livelihood, and
(d) the extent of the taxpayer's gambling activities, including the number and
frequency of bets.

It is clear from various decisions of the courts that earnings from illegal
operations or illicit businesses, such as illegal gambling and fraudulent
business schemes, are not exempt from tax. (See for example, the decisions in
The Queen v. Poynton, (1972) CTC 411, 72 DTC 6329 (Ont. C.A.) and MNR v.
Eldridge, (1964) CTC 545, 64 DTC 5338 (Ex. Ct.).)