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US Gambling Sites / Will there be taxes on online sports betting in Ontario?

Will there be taxes on online sports betting in Ontario?

Jennifer Adams
Jennifer Adams
Publish Date: 24/02/2022
Fact checked by: Josh Miller

Big changes to Ontario sports betting are coming soon. On April 4, 2022, mobile and online single-game sports betting will launch with its new-look regulations.

sports betting taxes

Mobile and online single-game sports betting already went live in Ontario in August 2021. However, until now all that has been available is the Proline+ app, which is operated by the Ontario Lottery and Gaming Corporation (OLG). From April 2022, there will be more options available - but how will this affect taxation?

What changes are happening to Ontario sports betting in April 2022?

The Ontario government has created a new sports betting landscape by working with the newly-formed regulatory iGaming Ontario, a newly-formed subsidiary of the Alcohol and Gaming Commission of Ontario (AGCO). iGaming Ontario will be responsible for managing internet gambling in Ontario that is being provided by private operators.

In layman’s terms, this means that the Ontario online betting industry will cease to be a lottery-run monopoly, and will be more like a legal US gambling state, such as New Jersey. Multiple private sportsbooks are already able to apply for licenses to go live in Ontario from April. For you, this means a competitive market that will result in more choice.

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The current status of betting taxes in Ontario

Currently, the taxation of your winnings is very lenient - especially when compared to most US states. In fact, in the whole of Canada right now, no sports betting winnings are taxed as long as you are not projected to profit from gambling. This rule actually extends beyond sports betting and also includes winnings from daily fantasy sports contests and land-based casinos. Additionally, winnings from your sports betting or online casino gaming “grey market” (overseas) sportsbooks are also subjected to the same tax laws.

When are you considered to have profited from sports betting?

Again the rules here are fairly light if you an average sports bettor. Unlike in New York, for example, you do not have to include your total winnings losses from your sports bets in your tax return. In fact, in most cases, there is no paperwork at all. In order for you to pay taxes from any form of gambling, you have to be considered as a professional gambler - which is a status that’s only until now been afforded to the highest of high rollers - i.e professional poker players and the like.

Will the tax rules change when private sportsbooks launch in April?

No, so far all of the changes in the legislation have purely been surrounding the actual changes of single-game sports wagering itself. In a similar vein to the US lifting the PASPA back in 2018 following the state of New Jersey’s victory in the US Supreme Court, Canada has merely lifted its own federal ban on single-game sports wagering.

Ontario is merely now implementing the steps afforded by this to launch its own regulated private online sports betting sector. Your winnings will be subjected to the aforementioned tax rules that apply to winnings from the lottery-run sports betting app and the grey sportsbook market.

So how is the Ontario government getting revenue from this?

As you may have guessed, the sportsbook operators will be the ones getting taxed instead of you as the bettor. Of course, there’s always the chance that this could mean you’re indirectly tasked via the sportsbooks creating a higher overround for themselves on bets, etc. However, if this does happen, you’re unlikely to notice it all that much. The Ontario betting market looks set to be quite competitive, with around 30 licenses already having been applied for and established the presence of the grey market. Therefore things should stay beneficial for you as a consumer, at least in the short-to-mid term.

Will there be taxes on online sports betting in Ontario FAQ

💵 Do you have to pay taxes on betting in Ontario?

The answer to this question depends on where you are located. Additionally, it also differs from the point of view of the bettor and that of the operator. Discover more on our site at CaptainGambling.com.

🇨🇦 Is online gambling taxed in Canada?

More information regarding gambling taxation in each Canadian province can be found by visiting CaptainGambling.com.

🏦 Will betting tax laws change once online sportsbooks become legal in Ontario?

You can keep up-to-date on all the upcoming changes to the online betting landscape once private sportsbooks launch in Ontario, by visiting CaptainGambling.com.

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Players must be 19 years of age or older to reach the minimum age for gambling in Ontario. Please play responsibly. Bet with your head, not over it. If you or someone you know has a gambling problem, and wants help, call or visit: (a) www.igamingontario.ca; or (b) www.connexontario.ca.

Players must be 19 years of age or older to reach the minimum age for gambling in Ontario. Please play responsibly. Bet with your head, not over it. If you or someone you know has a gambling problem, and wants help, call or visit: (a) www.igamingontario.ca; or (b) www.connexontario.ca.

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