Canada
What You Need to Know About Gambling and Your 2021 Taxes
The deadline for filing 2021 federal tax returns looms on April 18 this year and for gamblers, it’s an occasion to be reminded of how the tax code addresses their gaming activity. Generally speaking, that’s not too kindly.
The bottom line is simple and stern. As a rule, all income from gambling — including real money online casino play — must be reported eventually on Line 8 of the familiar Form 1040 (along with inclusion on Schedule 1).
To some, it may come as a surprise that gambling income is reported as a gross figure and not a net result. That stands in contrast to, say, capital gains or losses realized in stock transactions, which are reported on Line 7 of the Form 1040 (usually, along with a Schedule D).
In plain English and by example what that means is this: If a taxpayer wins $500 playing the slots in a casino on Monday and then loses $800 playing the slots on Tuesday, the taxpayer is required to report the $500 win on his Form 1040 on Line 8. The $800 loss would be accounted for on Schedule A (Itemized Deductions) — but there are caveats.
The first may be familiar to taxpayers who gamble. Reported gambling losses cannot exceed gambling wins so in the above example, the taxpayer would have an allowable deduction of just $500 for net zero result (the gamble eats the excess $300 loss). But then there’s another issue.
The taxpayer gets to account for gambling losses only if he/she itemizes deductions on Schedule A. And as a result of the 2017 tax revision, the allowance for the standard deduction was raised to a point where it doesn’t make financial sense for the vast majority of taxpayers to itemize their deductions.
What that means for many taxpayers who gamble relatively modestly is that they have no opportunity to deduct any gambling losses. So, the gaming “win” stands alone as income even if the aggregate gambling activity was a net loss.
As an aside, the standard deduction for married couples filing a joint return for tax year 2021 is $25,100. For single taxpayers and married individuals filing separately, the standard deduction is $12,550. For heads of households, the standard deduction is $18,800.
The impacts of gross gambling income on line 8 may be subtle but can be significant. For instance, that amount gets carried down to Line 11, adjusted gross income, which can affect a range of tax circumstances, such as how much of the taxpayer’s Social Security benefits are taxable.
FUNDAMENTAL TAX RULES FOR GAMBLERS
- Taxpayers who gamble should remember that all gambling winnings must be reported as income regardless of whether the operator issues documentation, such as a W-2G or a Form 1099.
- Unfortunately, gamblers cannot “net” their winnings and losses when reporting gambling income. Gambling income is usually reported on Schedule 1 and then carried over to Form 1040, Line 8.
- Gambling losses are accounted for on Schedule A, Itemized Deductions, and taxpayers must itemize to get the benefit of a gambling loss deduction. However, taxpayers have to choose between itemizing deductions or taking the standard deduction.
- If gambling losses are taken as a deduction, they cannot exceed the amount of gambling wins.
- Win or lose, taxpayers should keep a journal of their gambling activity. They should note where, when, what games were played, and how much was won or lost. Taxpayers should also keep any evidence of wagering activity, losses included.
- State taxes may also be due on gambling winnings and rules vary from state to state. Gamblers should familiarize themselves with their state’s tax policies on gambling income.
OTHER THINGS TO KEEP IN MIND
The proliferation of gambling, both bricks-and-mortar and on the internet, has created complications for taxpayers that should be addressed by a tax professional but there are some things taxpayers should keep in mind.
As mentioned earlier, keeping a journal of gambling activity be part of your record-keeping.
Remember, all gambling winnings are reportable even if a gambling operator doesn’t issue paperwork, often a W-2G or a 1099-MISC or a 1099-K.
And speaking of W-2Gs, here are the occasions when the Internal Revenue Service says a W-2G should be issued by the gambling operator:
- 1. The winnings (not reduced by the wager) are $1,200 or more from a bingo game or slot machine;
- 2. The winnings (reduced by the wager) are $1,500 or more from a Keno game;
- 3. The winnings (reduced by the wager or buy-in) are more than $5,000 from a poker tournament;
- 4. The winnings (except winnings from bingo, slot machines, keno, and poker tournaments) reduced, at the option of the payer, by the wager are:
- a. $600 or more, and
- b. at least 300 times the amount of the wager; or
- 5. The winnings are subject to federal income tax withholding (either regular gambling withholding or backup withholding).
What may irritate taxpayers who gamble is how gambling activity is treated as opposed to something like day-trading stocks. In the latter case, which also involves substantial risk-taking, the stock day-trader gets to net losses against gains without having to choose between itemizing deductions and taking the standard deduction.
UNFAIRNESS TO GAMBLERS
The unfairness to taxpayers who gamble, particularly those who play at modest levels, was noted by the American Gaming Association, the trade group that represents the gambling industry, when the 2017 tax code was being revised.
“Under such a higher standard deduction, small and mid-level slot machine players may not be able to itemize their deductions, even with their gaming losses, and hence may not be able to offset gaming wins reported as income with the full amount of their gaming losses,” the AGA said in a letter to Capitol Hill.
“AGA strongly recommends, as a matter of tax simplification, that gaming players should be permitted to subtract gaming losses from gaming winnings in order to compute their taxable net gaming income for purposes of reporting adjusted gross income, without being required to itemize their deductions.”
Unfortunately for gamblers, that recommendation was not taken by the Congress.
For years, the AGA has been trying to get the threshold for issuing W-2Gs raised from $1,200 to $5,000 without any luck. However, early in March, the Congressional Gaming Caucus advanced an effort to raise the slot tax threshold to $5,000 with bipartisan legislation and also provide a mechanism for future increases based on inflation. The current $1,200 slot tax threshold has not been adjusted for inflation since 1977 and, since then, the instances of $1,200 W-2Gs has skyrocketed.
DON’T FORGET STATE TAXES
In addition to concerning themselves with federal taxes, gamblers need to deal with state income tax obligations. Some states allow deductions for losses, some do not. Some states allow for losses and wins to be netted, most do not.
Michigan, for example, changed its tax laws recently to allow for gambling loss deductions where there are winnings. Mississippi, meanwhile, has its 3% tax where the gaming establishment withholds a 3% “nonrefundable” tax at the time a W-2G-level jackpot is hit regardless of whether the winner is a state resident.
Casino customers from outside the country get separate treatment. In many cases, the United States has tax treaties with other countries that dictate how non-U.S. gamblers are treated from a tax perspective. For instance, in the United Kingdom, gambling winnings are not taxed and the U.S. tax treaty with the UK means that U.S. taxes are not withheld from those gambling customers.
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Soft2Bet, a global provider of turnkey iGaming solutions, has announced plans to pursue entry into the regulated gaming market in Alberta as part of its broader strategy to expand its footprint across Canada.
The company confirmed that its entry will depend on regulatory approval once the province finalizes its evolving legal framework for online gaming. The move reflects Soft2Bet’s growing commitment to the Canadian market and its strategy to scale operations across newly regulated territories in North America.
A Strategic Move Toward Alberta’s Emerging iGaming Market
As one of Canada’s most economically robust provinces, Alberta has quickly become a focal point for iGaming operators and technology providers preparing for potential market liberalization.
Industry forecasts indicate that Alberta’s regulated online gaming sector could become one of the country’s most lucrative regional markets. Estimates from analysts at Citizens JMP Securities suggest that the province’s iGaming industry could generate over $700 million in annual revenue once the market reaches maturity.
Soft2Bet’s early evaluation of the market demonstrates the company’s proactive approach to identifying high-growth opportunities in newly regulated jurisdictions.
Monitoring the iGaming Alberta Act
Soft2Bet is closely observing developments surrounding the proposed regulatory framework established under the iGaming Alberta Act. The legislation outlines the structure for Alberta’s regulated online gaming industry and establishes oversight responsibilities for provincial authorities.
Under the proposed system, the Alberta iGaming Corporation would oversee the province’s online gaming ecosystem, while regulatory enforcement would remain with the Alberta Gaming, Liquor and Cannabis.
Soft2Bet has indicated that it is preparing to meet Alberta’s anticipated compliance and technical standards, ensuring its platform technology aligns with the province’s regulatory expectations.
Building on Canadian Experience
Soft2Bet’s potential expansion into Alberta builds upon its experience operating in Ontario, where the company already offers localized gaming services through its consumer-facing brand ToonieBet.
The Ontario market has become one of North America’s most successful regulated online gaming jurisdictions since its launch in 2022, attracting numerous international operators and platform providers.
By leveraging insights from its Ontario operations, Soft2Bet aims to deliver tailored gaming experiences for players in Alberta while maintaining full compliance with regional regulations.
Localization as a Key Strategy
Localization remains a central pillar of Soft2Bet’s international growth strategy. The company emphasizes adapting its platforms and gaming products to match the cultural preferences, language requirements, and regulatory expectations of each market in which it operates.
Soft2Bet plans to apply this hyper-localized approach in Alberta by ensuring that its gaming offerings reflect the specific needs and preferences of Canadian players.
This includes customized content, localized branding, and user experiences that resonate with regional audiences.
Commitment to Innovation and Player Experience
According to company leadership, innovation remains a driving force behind Soft2Bet’s expansion strategy.
David Yatom Hay, General Counsel at Soft2Bet, highlighted the company’s commitment to delivering engaging gaming experiences that align with local player expectations.
The company continues to invest in platform technology and product development to create dynamic gaming environments that combine entertainment, compliance, and user-friendly design.
Expanding Across Regulated Markets
Soft2Bet’s interest in Alberta is part of a broader roadmap for 2026, which includes entering additional regulated markets around the world.
As governments increasingly adopt regulated frameworks for online gaming, technology providers like Soft2Bet are focusing on scalable solutions that allow them to quickly adapt to different regulatory environments.
Turnkey platforms, which include player management systems, gaming content, and compliance tools, have become essential for operators looking to enter new markets efficiently.
Canada’s Growing iGaming Landscape
Canada has rapidly become one of the most promising regions for online gaming growth in North America. The success of Ontario’s regulated market has encouraged other provinces to explore similar frameworks.
If Alberta successfully launches a competitive iGaming market, it could further strengthen Canada’s position as a key hub for regulated online gaming innovation.
Operators, developers, and platform providers are closely monitoring the regulatory process, positioning themselves for entry once licensing becomes available.
Looking Ahead
For Soft2Bet, Alberta represents a strategic opportunity to expand its presence in Canada while reinforcing its reputation as a global iGaming platform provider.
By preparing early for regulatory approval and leveraging its experience in Ontario, the company aims to deliver localized gaming experiences that meet the expectations of Canadian players and regulators alike.
As Alberta moves closer to establishing its regulated online gaming framework, Soft2Bet’s planned market entry signals the growing interest from international technology providers seeking to participate in Canada’s evolving digital gaming ecosystem.
The post Soft2Bet Eyes Alberta iGaming Market Expansion in Canada appeared first on Eastern European Gaming | Global iGaming & Tech Intelligence Hub.
The Premier Operator and Platform Provider Announces Plans to Pursue Alberta Strategy as Part of its Roadmap, Anticipating the Region’s Upcoming Regulatory Framework
Soft2Bet, a leading iGaming turnkey solutions provider, today announced its intention to pursue entry into the Alberta market, pending regulatory approval. This strategic focus leverages Soft2Bet’s operational experience with localized offerings, including its Ontario-facing brand, ToonieBet.
Strategic Market Potential & Compliance
Alberta (Canada) represents one of the most significant growth opportunities in the North American iGaming landscape. With Canada’s youngest adult population and the highest GDPs per capita in the country, the province is well poised for a successful transition to an open, competitive market. Industry projections by Citizens JMP Securities suggest that Alberta’s regulated iGaming market could exceed $700 million in annual revenue at maturity.
Soft2Bet is closely monitoring the development of Alberta’s regulatory framework under the iGaming Alberta Act, which establishes the Alberta iGaming Corporation (AiGC) as the oversight body alongside the Alberta Gaming, Liquor and Cannabis (AGLC) as the regulator. Reflecting its commitment to the highest standards of integrity, Soft2Bet is preparing for the province’s specific technical requirements.
The planned entry into Alberta aligns with the company’s strategic plans for 2026 to drive sustainable growth, and enter several new regulated territories.
“Innovation is paramount at Soft2Bet, and our goal is to develop exciting products that meet our customers where they are most comfortable,” said David Yatom Hay, General Counsel, Soft2Bet. “As we evaluate our entry into Alberta, pending regulatory approval, we are committed to delivering localized, engaging experiences that reflect the unique preferences and culture of each market.”
Excellence in Canadian Localization
Soft2Bet aims to leverage its experience in Ontario to enhance the gaming experience for users in Alberta, Canada, with innovative, compliant products. A core component of the company’s regional strategy involves taking localization further by adapting its brands to local culture, regulatory standards, and player preferences.
To support its hyper-local focus, Soft2Bet targets comprehensive native-language support across its priority regions, ensuring its services are deeply integrated into the local culture of each active regulated market.
The post Soft2Bet Evaluates Alberta Market Entry to Strengthen its Canadian Footprint appeared first on Americas iGaming & Sports Betting News.
By CasinoCanada.com
In 2002, 76 percent of Canadians aged 15 and over reported gambling in the previous year, according to Statistics Canada’s report Fighting the Odds. By 2018, that figure had fallen to 64.5 percent, based on the agency’s Gambling Rapid Response module.
At first glance, that suggests gambling participation in Canada has declined over the past two decades.
Yet over the same period, gambling has become more visible, more digital and more embedded in sport and everyday life. Sports betting brands sponsor professional teams, betting segments are embedded in live broadcasts, and provincial regulators report billions of dollars in annual online wagering.
How can participation fall while the industry expands? The answer lies in how Canada’s gambling market has changed, and in who is driving its growth.
This analysis draws on national participation surveys and provincial financial reporting to compare long-term participation trends with recent regulated market performance.
Research highlights of this article
- National gambling participation declined from 76% in 2002 to 64.5% in 2018.
- Ontario’s regulated online market generated approximately CAD 1.3 billion in revenue in 2022–23, rising to CAD 2.9 billion in 2024–25.
- Total wagers in Ontario increased from approximately CAD 63.2 billion in 2023–24 to CAD 82.7 billion in 2024–25.
- Online casino accounted for roughly three quarters of Ontario’s regulated online revenue in 2024–25.
- Approximately 2.6 million active player accounts were recorded in Ontario in 2024–25.
Growth without more players
If fewer Canadians report gambling today than in the early 2000s, market growth cannot simply be explained by expanding participation. Since its launch in April 2022, Ontario’s regulated online gambling market has grown year over year. According to iGaming Ontario’s Annual Reports, in its first full fiscal year, the market generated approximately CAD 1.3 billion in gaming revenue. That rose to CAD 2.2 billion in 2023–24, before reaching CAD 2.9 billion in 2024–25. Total wagers also significantly increased from approximately CAD 63.2 billion in 2023–24 to CAD 82.7 billion in 2024-25.
The latest annual report also recorded approximately 2.6 million active player accounts in a province of roughly 15 million residents. Even allowing for multiple accounts per individual, the figures suggest a highly active digital environment concentrated among a defined segment of players.
The implication is clear: recent market growth appears to be driven less by an expanding audience and more by increased activity per active player.
Operators active in the market say the same shift is visible in player behaviour since Ontario introduced its regulated online framework. Dmitry Arabuli, CEO at Tonybet, said: “Since regulation launched in Ontario, the player landscape has changed significantly as many of the largest North American operators entered the market. Competition increased, with the focus shifting from chasing large volumes of casual participants to building stronger relationships with more informed and engaged players. These players tend to interact more frequently with betting products and show stronger loyalty to the platforms they trust.”
“Regulation also drew a clearer line between grey-market operators and licensed platforms. Many players who were previously using offshore sites have migrated towards regulated products. This did not necessarily expand the total number of gamblers, but it redirected an existing player base into the licensed ecosystem.”
Despite sports betting dominating headlines since the passage of Bill C-218 in 2021, online casino remains the commercial engine of Ontario’s regulated market. iGaming Ontario’s 2024–2025 annual report shows that online casino generated approximately CAD 2.2 billion of the CAD 2.9 billion in total gaming revenue.
In other words, casino accounts for roughly three quarters of the province’s regulated online revenue.
Sports betting reshaped visibility, but casino sustains the economics.
Modern growth appears to be driven less by player acquisition and more by retention and increased engagement within the existing customer base.
A provincial and digital transformation
One reason the national picture can appear contradictory is that Canada does not operate a single gambling model.
Ontario runs a competitive regulated online market with dozens of licensed operators. Other provinces continue to rely primarily on government-operated platforms. Alberta has signalled plans to introduce its own regulated framework.
Since 2018, most of the meaningful growth data has been provincial and digital, not national and survey-based. While participation surveys provide a broad snapshot, provincial market reports reveal how play is evolving in practice.
The shift from retail-based lottery and venue gambling to app-based multi-vertical platforms represents a structural transformation. Gambling is increasingly platform-based, integrated into smartphones and digital ecosystems rather than tied to specific locations.
That structural change helps explain how the industry can grow even without broader participation.
Visibility versus participation
Following the legalisation of single-event sports betting, sportsbook partnerships and advertising have expanded across professional sport. Major leagues, including the National Hockey League, have entered into official betting partnerships at the league level, while Canadian competitions such as the Canadian Football League and Canadian Premier League have also announced sponsorship agreements with licensed operators.
Betting brands now feature prominently in arena signage, broadcast integrations and digital content, embedding gambling directly into the commercial presentation of professional sport.
Dmitry Arabuli, CEO at Tonybet, said: “Ontario regulation made gambling become much more visible in sports broadcasts, live events and daily sports culture. It opened significant opportunities for operators such as Tonybet to do business in Canada legally and build brand awareness through marketing and PR campaigns. For example, Tonybet has previously partnered with the Canadian Premier League and currently works with the Canadian Elite Basketball League.”
Arabuli added that these partnerships help operators connect with highly engaged sports audiences. “These partnerships help strengthen brand awareness, target high-value players, and improve customer retention by building trusted and long-term relationships in the Canadian market.”
Yet fewer Canadians report gambling than two decades ago.
This disconnect between rising visibility and declining participation creates a cultural tension. Gambling is increasingly framed as a routine extension of sport rather than a distinct commercial activity.
For younger audiences in particular, repeated exposure through live broadcasts and social media feeds helps position betting as part of the sporting experience itself, regardless of whether participation is expanding.
Visibility, in other words, is reshaping how gambling is perceived, even if it is not expanding its audience.
Selected examples of publicly announced partnerships, as of 13 March 2026, are outlined below.
Selected Professional Sports Betting and iGaming Partnerships in Canadian Sport
| League / Organisation | Betting Partner | Nature of Partnership | Scope |
| National Hockey League (NHL) | ESPN BET; theScore Bet | Official league betting partner | North America / Canada |
| Canadian Football League (CFL) | ToonieBet | Official sports betting and casino partner | Canada |
| Canadian Elite Basketball League (CEBL) | TonyBet | Official online sportsbook partner | Canada |
| Maple Leafs Sports & Entertainment (MLSE) | Betty | Official online casino partner | Ontario |
Sources: Various league and operator press releases; compiled by CasinoCanada.com.
Risk concentration and policy relevance
If growth is increasingly driven by more intensive digital play among a defined group of participants, the social and regulatory implications become more complex.
Market expansion rooted in activity rather than recruitment raises questions about how gambling risk is distributed. A smaller base of highly active players may account for a disproportionate share of wagering volume.
At the same time, regulators are increasingly focused on channelisation, responsible gambling tools and sustainable market design. If the future of Canada’s gambling market depends more on engagement intensity than expanding participation, policy debates may shift accordingly.
The conversation may move away from how many Canadians gamble and towards how gambling is structured, monitored and integrated into daily digital life.
The next phase
Alberta’s regulatory plans suggest Canada’s gambling evolution is not over. But the next stage may not be about expanding participation. It may be about managing a digital market driven by deeper engagement among a smaller group of players.
Canada’s gambling market is no longer expanding simply because more people are playing. It is expanding because the way people play has fundamentally changed.
The paradox remains: fewer players, larger market.
Methodological note: National participation figures are drawn from Statistics Canada surveys conducted in 2002 and 2018. More recent insights are based on publicly available provincial regulator reporting, which measures wagering, revenue and account activity rather than survey participation. As such, national participation trends and provincial activity data are not directly equivalent but are analysed comparatively to assess structural change.
The post Fewer Canadians gamble than 20 years ago. So why is Canada’s market still growing? appeared first on Americas iGaming & Sports Betting News.
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