There isn't anything illegal about receiving money to your bank. It could be gambling profits, it could be a side business, it could be a registered business, it could be you do some online or website design work or whatever. I was just curious if the banks make it policy of knowing the details and history of electronic / wire transfers.

And to the suggestions of making one big withdraw to your bank a year, I mean how ridiculous is that if you were the type of person that lived of the profits you were making which arrived by the e-transfer/wire transfer.

Yes there is something illegal about structuring deposits to your bank to stay under 10K. Obviously 1 withdraw a year is not optimal but neither is 8K/week or whatever.

fair enough but what exactly is illegal about it?

Purposely organizing your transactions in order to avoid reporting requirements or any other law (with no other purpose than to avoid the reporting laws) is illegal.

Individual banks do not monitor fund transfers. Generally, no one does. However, transfers can come to FINTRAC's attenion if:
1. they are already looking at you for another reason and are watching everything you do, which is usually because you are suspected of being a terrorist, drug dealer or misc money launderer. They may also be acting on a tip from a friend, neighbour or other party. It is almost never for pure tax reasons.
2. Your bank reports you as engaging in suspicious activity. Banks have a know your client rule. If what you do at the bank is not typical to what they know about you, they are supposed to report you.
Nothing illegal about depositing a lot of $20 bills every day, but if you're not a known store owner you will likely get reported. Nothing illegal about getting wires from Nigeria but if the bank doesn't know you are a business with customers there, you will get reported. Both are known flags.
If they have reason to suspect you are purposely sending/getting money regularly that is just under 10k and they don't know why, they will eventually report you. The reporting of transfers is not done at the branch level but at corporate by the compliance people.

Since FINTRAC does not per se look for tax cheats, there is not a really big deal about getting reported unless you are doing other illegal stuff.
Only the rare people whofeel the need for absolute secrecy with no involvement in illegal activities should care.

The most common thing a money launderer will do is transfers for 9500, 9600 or 9700. Do that regularly and you'll be in the database.

If you are worried, than 1 big wire will not raise any attention. For feasibility, you might need to break that up but the point is mechanically wiring X every Y days looks worse (especially if X approaches 10k) than doing random number every random number of days.

Ok, I really appreciate the feedback, thanks. And there doesn't seem to be a reason to keep transfers under 10k as long as the transfers are random in frequency and amount, correct? And I suppose if a person had 2 bank accounts to disperse the deposits, there'd be less attention drawn from just one bank?

There's no reason to worry about how much each wire is if you don't care
about some chance of being in FINTRAC's database.

The only people who must worry are those involved in illegal transactions, people who place an extraordinary value on privacy and those worried about the tiny chance of FINTRAC tipping off the CRA about undeclared income.

What is you opinion on having a NIQ mortgage and CRA getting interested?

I am not aware of any special risks or any designated staff or program for reviewing NIQ mortgages.

I can't see them knowing who has a NIQ mortgage routinely (since mortgage details aren't readily public knowledge) and thus there is nothing to flag them.

Really the only way CRA will know to look is if they are already looking at you for something else and do a net worth assessment. At that time, they know you have a house with little/insufficient income and don't care how you got financing for the balance so the fact it was NIQ probably doesn't tell them
anything they don't already know.

As I understand it when CRA does a net worth assessment it's fairly basic, in that they just add up the dollar value of all your assets and subtract your declared income in the years they are looking at and then put the onus on you to explain the difference (within reason of course), correct?

essentially that is correct.
It is change in assets + estimated living expenses - declared income = estimated undeclared income.

99% of the time the person will claim the difference came from gifts from family and then the CRA goes to the family member and does the same thing to see if they could have afforded to give the difference and whether there are any cheques showing they did.

A little off topic but what do you recommend as the best Canadian Investment forum? I have a ton questions and havent found anything too great in my searches.

I've read the thread and the tax ebook, but I'm not a lawyer so it's a bit tough to fully understand.

These are the conclusions I've made

1) If you're only playing poker for a living and have been for a couple/several years then it's likely taxable and tax experts would advise you to pay.

2) However since the legal area is still grey area, and for various other reasons the CRA will likely not come after you specifically for poker.

3) The CRA can and will however come after you with a net worth assessment where the onus is on you to prove where the increase in net worth has come from.

Are my conclusions correct? Is this what everyone else thinks as well?

QT:

(1) ~yes
(2) definitely cannot be sure of this; see (1)
(3) ~yes

Awesome thanks for the quick answers Tax Guru!

I have another quick question, at least I think it's quick

From what I gather poker is not taxable if it is your hobby. So if I have a job or a part time job then poker would be considered a hobby and not taxable. However I'm a bit confused

Take these 2 cases

Case 1:

I have a job that pays 50k a year and I earn 150k from poker. Or for another example, my job pays 15k a year and I earn 30k from poker.

Case 2: I have a job that pays 50k a year and I earn 10k from poker. Or again I have a job that pays 10k a year and I earn 8k from poker.

In either case would poker be taxable?

I guess my question is I've making my living off of playing poker for a couple of years (and have been paying tax on my earnings) and am now considering going back into the work force part or full time, for tax purposes does my poker playing then shift to being a hobby and is therefore no longer taxable? Does it matter how much I make at my job compared to my poker earnings?

Thanks again! Looking forward to ur thoughts

The amount of money you make is not the factor in the taxable question. Even if you only make $5k/year from poker if you have made $5k a year for the last five years then it is taxable. The only difference is the government won't notice $5k since it has no impact on your quality of life but $150k they might notice.

Good think this topic popped up and i totally forgot that I have to respond to CRA by the 15th. Seems like me calling them lazy ******s was a little premature.

If you have a hobby with a REOP, it is taxable.

and how will they determine REOP? I could just tell them I binked a couple of tournaments and got lucky?

Fine. The onus is on you to prove it.

I don't think it's that simple, especially given that (I think?) you are a semi-known midstakes+ player so I would bet your name appears somewhere on the internet in a poker-related context. Like if you've been interviewed for a website or anything like that it becomes much tougher to just say "yeah I'm a random luckbox donk."

thanks for the quick answers again.

Did I miss something? What's going on here?

Nothing serious. CRA is just being annoying and nothing will come of it. It does show that they are paying more attention than they use to but nothing I would get concerned about.

From loto-quebec's website about their online gambling site.

http://lotoquebec.com/corporatif/nav.../online-gaming

Thanks for the info Guru,

My question: Is there a kind of statute of limitations on poker winnings, like for example if I stopped playing (or stopped making money) and get audited 5 years down the road will I still have some splainin' to do about the poker winnings from 5-10 years earlier?

Thanks.

so making a full time poker income in quebec is tax fee?

What if we have a separate business that does not draw much income (under 10K)?