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Old 02-08-2010, 04:41 AM   #1051
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by Carnivore View Post
Anyone surprised by this?

I paid my taxes for 2008. The government contacted me asking me where the money came from. I told them I won it playing card games at casinos. I also specifically told them that the reason I paid it was because I had no job and relied on cards for an income. They told me I don't need to pay that and said a refund is on it's way.

I fist-pumped.
It's beyond fairytale, it's inconceivable!!
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Old 02-08-2010, 04:42 AM   #1052
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Re: Canadian Online Poker Tax Thread

Not surprised at all. The public service is staffed by idiots. Congrats though. This basically gives you a free pass for the future.

By any chance do you have this in writing?

Also when you said playing cards did you specify poker specifically or just cards?
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Old 02-08-2010, 04:51 AM   #1053
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by Carnivore View Post
Anyone surprised by this?

I paid my taxes for 2008. The government contacted me asking me where the money came from. I told them I won it playing card games at casinos. I also specifically told them that the reason I paid it was because I had no job and relied on cards for an income. They told me I don't need to pay that and said a refund is on it's way.

I fist-pumped.
please send me all their paperwork response
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Old 02-08-2010, 08:50 AM   #1054
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by Carnivore View Post
Anyone surprised by this?

I paid my taxes for 2008. The government contacted me asking me where the money came from. I told them I won it playing card games at casinos. I also specifically told them that the reason I paid it was because I had no job and relied on cards for an income. They told me I don't need to pay that and said a refund is on it's way.

I fist-pumped.
I've seen this several times and I've mentioned this before.

If you get a clerk level person who doesn't understand the laws they may make mistakes like this. It is all luck of who looks at it (and a little of exactly what you tell them).

I've seen people get hounded by auditors for 20k in winnings and I've seen people with 400k in winnings get a get-out-of-jail free card.
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Old 02-08-2010, 03:08 PM   #1055
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by Carnivore View Post
Anyone surprised by this?

I paid my taxes for 2008. The government contacted me asking me where the money came from. I told them I won it playing card games at casinos. I also specifically told them that the reason I paid it was because I had no job and relied on cards for an income. They told me I don't need to pay that and said a refund is on it's way.

I fist-pumped.
I am curious how much you claimed as income. Also anything in writing
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Old 02-08-2010, 04:17 PM   #1056
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Re: Canadian Online Poker Tax Thread

Great thread guys.

This is my situation. Im 22 living in Lethbridge Alberta and 2009 was my first year playing poker professionally and I'm still undecided on what I'm going to do in terms of taxes. I play online cash pretty much everyday and made mid to high 5 figures American doing that after including rakeback and bonuses. I also played a fairly small amount of tournaments, 78 in total, and netted about 105k in them with 92k of that coming in a 2nd place score in a WCOOP event. Outside of 2009 I have not been a winner in tournaments.

If I decide to file taxes, how much would you guys say is taxable income given that I only played tourneys a couple days a month and most of my winnings came from one score?

Also I rent a room in a house that doubles as my poker office for $450 a month. Is 100% of this deductible? Should I be getting receipts for this? I have just been playing my landlord cash without getting receipts back.

Also previously when I had real jobs I would just have my mom do my taxes on the computer. She does this as a part time job for a month or 2 every year, but if I file taxes I feel like I should go to a certified accountant. Is this thinking correct? And do you guys have any general advice for going about getting an accountant that would fit my needs? If anybody out there knows one that has experience doing poker players taxes in southern Alberta a pm with their info would be very helpful.
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Old 02-08-2010, 04:22 PM   #1057
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Re: Canadian Online Poker Tax Thread

I think most of your answers can come just from reading this thread. It sounds like you're a casual player that had a windfall. Henry and Toronto have continually said that is not taxable.
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Old 02-08-2010, 04:27 PM   #1058
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by TorontoCFE View Post
I've seen people get hounded by auditors for 20k in winnings and I've seen people with 400k in winnings get a get-out-of-jail free card.
What did the hounding involve? Do they have to account for every transaction and prove that they are casual and not professional? And, if the CRA decides that you are professional, I assume they make you pay the tax you missed + penalties and probably also review previous years as well.
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Old 02-08-2010, 06:01 PM   #1059
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Re: Canadian Online Poker Tax Thread

The hounding involved many questions to establish the depth duration of the activities. They weren't asked to detail individual transactions, but asked about whether most of the winnings were from single /large events.

These were people being reviewed for other business reasons and all deposits on the bank statements were being questioned. When the CRA found that some were from another potential source, the people had to explain the extent of their activities. Ultimately they didn't have to go further, but it was certainly a few days of explanations and the CRA did not immediately discard the possibility of assessing tax.

It was not part of an audit, but rather an informal review. I had this done to me personally 3 years ago. I received a letter asking for clarification of my situation. I replied and got a second letter saying thanks for the info and the matter was closed.
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Old 02-08-2010, 11:06 PM   #1060
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Re: Canadian Online Poker Tax Thread

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Originally Posted by Henry17 View Post
Wrong. It is for any transaction.



Depending on your objectives one might offer a little benefit over another but for the vast majority they are pretty much equivalent.



Are you new to Canada? Most people get bank accounts when they are tweens. No real difference between banks. Different people have different experiences with various banks. The branch manager is likely a more relevant factor than the bank.

All banks offer ATM cards that can be used form almost anywhere in the world. If you mean actually going into a branch that seems unlikely. While Canadian banks do own foreign banks and even have banks under their own banner in other countries you generally can't access your Canadian accounts though those branches. If any bank offers such a service though it will be HSBC.



Yes. Sadly most branches don't even keep that kind of money on hand unless it is a big branch or it is a high traffic day like when social assistance gets deposited. You generally have to call ahead and give them a day or two notice. For $5k they may not ask too many questions but they might. For $10k they will. Trying to get around this by going to multiple branches does not work. Banks also have no sense of humor so cocky and funny does not play well. If you need the money for playing live the best thing is just to keep your bankroll in cash at home.


Not new to Canada, but I've only been 18 for a few months and I've never had a real job, so no need for a bank account before now.

The withdrawal would be for going on vacation. Do you just answer truthfully for all of their questions?


Again, thanks for any help, and sorry if this has been asked before.
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Old 02-09-2010, 01:35 AM   #1061
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Re: Canadian Online Poker Tax Thread

Do what you want with this information, its not advice. Now that I got that out of the way I asked my aunt, who's a bank manager at a TD bank, about the minimum she reports with respect to poker withdrawals as I had seen conflicting information on these forums and she said she doesn't report anything thats done electronically. She is, however, required to report any cash transactions that seem suspicious and that can be for any amount, even as little as a few hundred dollars.

Also, my brother in law was an auditor for Revenue Canada (on the business side) and even he didn't know if poker players had to pay taxes. He asked some of his co-workers and got different answers. So it doesn't surprise me the previous poster got his taxes back, it seems to be luck of the draw on who files your taxes.
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Old 02-09-2010, 01:46 AM   #1062
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by lozen View Post
I dont think Henry is telling you which is best just some of his ideas. Keep in mind that with tax crimes you are guilty until proven innocent. So you need to determine risk over reward. I still think the best strategy is to claim a portion of your winnings only. Utilize check cashing services and pay cash as much as possible. If your making $100,000 playing poker Claim $55,000.
Maybe Henry or TorontoCFE would be better to chime in here but isn't this a really bad idea? You can no longer claim ignorance and this becomes actual tax evasion which I believe could even land you in jail?

Quote:
Originally Posted by Carnivore View Post
Anyone surprised by this?

I paid my taxes for 2008. The government contacted me asking me where the money came from. I told them I won it playing card games at casinos. I also specifically told them that the reason I paid it was because I had no job and relied on cards for an income. They told me I don't need to pay that and said a refund is on it's way.

I fist-pumped.
You sir run good.
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Old 02-09-2010, 02:57 AM   #1063
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Re: Canadian Online Poker Tax Thread

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Originally Posted by PatInTheHat View Post
Maybe Henry or TorontoCFE would be better to chime in here but isn't this a really bad idea? You can no longer claim ignorance and this becomes actual tax evasion which I believe could even land you in jail?
Yup claiming partial would be the worst thing you could do imo. Either claim 100% or claim 0 and plead ignorance.
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Old 02-09-2010, 05:44 AM   #1064
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Re: Canadian Online Poker Tax Thread

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Originally Posted by CxF View Post
The withdrawal would be for going on vacation. Do you just answer truthfully for all of their questions?
Even telling the truth can get your accounts closed if the story is odd and they don't believe you (happened to me a few years back) I think the best way to deal with large ash transactions is just to slowly build a cash buffer. Depending on your lifestyle keep $10k, $50k, $100k whatever is appropriate in cash and then if you spend some of it start replenishing it.


Quote:
Originally Posted by PatInTheHat View Post
Maybe Henry or TorontoCFE would be better to chime in here but isn't this a really bad idea? You can no longer claim ignorance and this becomes actual tax evasion which I believe could even land you in jail?
I don't think it will land you in jail but it would certainly not be good if you got caught. You can accomplish the same (possibly more even) tax reduction by just incorporating so if you plan to claim poker as income you should definitely incorporate and just pay the actual amount.
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Old 02-09-2010, 09:08 AM   #1065
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Re: Canadian Online Poker Tax Thread

I think this entire thread can be summed up as follows.

Although this is an area of legal uncertainty, we can at least reduce the zone of uncertainty dramatically.

We know for certain:
1. all players begin playing casually (i.e. are non-taxable)
2. with enough success and effort over a sufficient period of time, players become taxable

What we do not know:
3. where the line is from moving from 1. to 2.

The answer will inevitably turn on a number of factors, including:
(a) extent of success
(b) effort expended
(c) length of time playing
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Old 02-09-2010, 01:46 PM   #1066
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by TaxGuru View Post
I think this entire thread can be summed up as follows.

Although this is an area of legal uncertainty, we can at least reduce the zone of uncertainty dramatically.

We know for certain:
1. all players begin playing casually (i.e. are non-taxable)
2. with enough success and effort over a sufficient period of time, players become taxable

What we do not know:
3. where the line is from moving from 1. to 2.

The answer will inevitably turn on a number of factors, including:
(a) extent of success
(b) effort expended
(c) length of time playing
Agreed
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Old 02-09-2010, 07:10 PM   #1067
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Re: Canadian Online Poker Tax Thread

Quote:
Originally Posted by TaxGuru View Post
I think this entire thread can be summed up as follows.

Although this is an area of legal uncertainty, we can at least reduce the zone of uncertainty dramatically.

We know for certain:
1. all players begin playing casually (i.e. are non-taxable)
2. with enough success and effort over a sufficient period of time, players become taxable
Clearly nobody knows this for certain, probably not even the person who wrote the law. We'll only know for certain when it gets fought in court and goes to the supreme court. And the way I interpret the law "a reasonable expectation to profit" means the odds are clearly in your favor. Like the house has a reasonable expectation of profit in blackjack. How can you say I have an expectation of profit when me and the other 5 players all have the same opportunities to be successful? If anything we all have a reasonable expectation to lose because of the rake. When I sit down to play I never know for sure I'm going to continue winning. All I can do is play then based on my results determine if I was profitable that day. Plus the games (and my game) are always changing so even though I was a winner yesterday doesn't mean I'll still be a winner tomorrow.
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Old 02-09-2010, 08:00 PM   #1068
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Re: Canadian Online Poker Tax Thread

That argument makes no sense given the case law.
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Old 02-09-2010, 09:33 PM   #1069
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Re: Canadian Online Poker Tax Thread

Are results alone enough for them to conclude I have a reasonable expectation to profit or do they have to show why I have an expectation to profit?

If I had won a few hundred thousand dollars a year for the past ten years playing roulette is that all the proof they need to say I have a reasonable expectation to profit? Even though the math clearly shows its impossible to profit from roulette?
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Old 02-09-2010, 11:19 PM   #1070
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Re: Canadian Online Poker Tax Thread

The law must make choices all the time in the presence of uncertainty.

If you won hundreds of thousands of dollars at roulette for ten straight years, it is astronomically more likely that you had discovered a way to become +EV on roulette than that you were simply the 1 in the 10^20 (or whatever) player for whom that would happen to by chance. Simple Bayesian statistics.
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Old 02-10-2010, 02:12 AM   #1071
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Re: Canadian Online Poker Tax Thread

Roulette is not a game of skill so we would never get to that part of the test. Substitute any skill game for Roulette and the answer is yes.

Even for non-skill games like Roulette the argument would like be made that you had found a way to either clock the wheel or exploit casinos with bias wheels thus turning a game of chance into a game of skill and then the answer would be yes again.
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Old 02-10-2010, 06:44 AM   #1072
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Re: Canadian Online Poker Tax Thread

If you win at roulette that consistently, the only viable conclusion is that you're cheating. If you're cheating and +EV, you're taxable.
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Old 02-11-2010, 12:08 AM   #1073
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Re: Canadian Online Poker Tax Thread

Question to anyone that might have an answer. I'm born and raised in Canada, but my Dad was born in Scotland so I could get dual citzenship. I'm wondering, if I get my dual citzenship, and assuming that in Canada my poker winnings are taxable, is there a way to get around them given that in the UK it is non-taxable?

Thanks a lot! I just have no clue how taxes work with dual citzenships.
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Old 02-11-2010, 04:54 AM   #1074
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Re: Canadian Online Poker Tax Thread

Taxes in Canada have zero to do with citizenship.
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Old 02-11-2010, 06:43 AM   #1075
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Re: Canadian Online Poker Tax Thread

It is almost totally irrelevant...

If you were resident in both jurisdictions, it may come into account when considering some of the "tie-breaker" rules in the tax treaty regarding determination of residence, etc. Being a citizen of both doesn't help you in this respect.

And in any event this also assumes you could mount a vigorous argument to support a claim that the "source" of the income was not connected in a substantial way to Canada, which might be difficult if you do all your playing here.
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