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Originally Posted by Lefort
The one thing I'm a bit conflicted about is just how "dumb" we should play if ever faced with the phone call from the CRA. If we play completely dumb about having no idea we should have paid, does it not show complete ignorance/negligence? Should we not at least have some sort of back-up material showing why we were under the impression that we shouldn't have to pay? (ie. the nut material would be a respectable lawyer's report saying so but that seems to be pretty hard to come by) Basically just something to show that it was your (and perhaps, others as well) interpretation of the tax laws that led you not to pay, not just simply because you're a degen gambler that never even considered it.. (negligence?)
No. If you have material for why you shouldn't pay then that means you did research and someone who did research would know that professional gamblers are taxable.
With the exception of people who went to law school or who have participated in discussions with someone who has the common belief is that gambling is not taxable in Canada. If you stopped 100 people on the street and asked is gambling taxable in Canada 90+ would say no. It is what makes our lottery and casinos different than the US. It is the defacto situation.
If when caught you want to argue that you still shouldn't pay taxes that is when you start building the reasons why. This type of thing moves at a glacial speed so you have time.
You start off with well I didn't know better. The reason for that is to avoid culpability as much as possible. Now that I know though this is why I still don't think I should pay taxes.
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And lastly (hypothetically speaking of course), are the CRA employees in charge of these things so dumb that it's possible for a student to make a bunch of money while at school, not claim it, move on after school, never get a job, and keep playing poker (without claiming) for 5+ years with no working income each year (yet *somehow*, all sorts of investment income), and never hear a peep about it? For some reason I just have this gut feeling that somewhere lies an all-seeing eye that just won't let this type of thing happen. This is the reason why I felt like getting a part-time job might help me "fly under the radar" without such a glaring oddity existing in my claims each year.
It really depends on how you behave. I know people who have been doing this since most 2P2 were in elementary school and CRA has not bothered them. I also know people who get in trouble after a couple of years. In the last few years governments have gotten very serious about catching money laundering and when you combine that with poker becoming part of the popular culture and the game moving online where it is so much easier to track I think getting caught is a legitimate concern. Not sure what the response to that is though. Most people will **** up trying to hide income and volunteering to pay income tax seems a little silly.