Judge Finds That Duhamel's Poker Playing Didn't Constitute "Business Activities"

Published on June 29th, 2022 11:59 pm EST

If you are a poker grinder and a citizen of Canada, you might want to read the recent ruling that a judge passed down in the Jonathan Duhamel vs CRA (Canada Revenue Agency) court case.

After battling with the CRA for nearly a DECADE, a judge finally ruled on the case and found in favor of Jonathan Duhamel, who won the World Series of Poker main event in 2010.

In Canada, gambling winnings are generally tax-free.

The exception? If the CRA contends that you are gambling "beyond mere entertainment" and operating as a business, they will attempt to tax you, as they did with Jonathan Duhamel.

This would have amounted to millions of dollars in tax owning for Duhamel, as the CRA reassessed Duhamel's 2010, 2011 and 2012 tax years, contending that he made roughly $5.2 million in business income over those years and now owed the CRA millions of dollars.

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Duhamel's defense was twofold:

1) Poker is a game of chance and it's very hard to call playing poker a "business" when it's a game of chance

2) He had no formal poker training and no "system" to regularly win in poker

The CRA contended that Duhamel was operating his poker ventures as a serious business (they pointed to his Pokerstars sponsorship deal as evidence of this) and should be taxed as a business.

The two sides spent nearly two weeks in court, calling in expert witnesses and making their cases.

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In the end, the judge sided with Duhamel, stating that the 2010-2012 years should not be taxable and that the CRA hadn't proven that Duhamel's poker activities were carried on in a "sufficiently commercial manner".

If you are a grinder that is a Canadian citizen, this is good news for you, as the Canadian government is clearly going to have a very hard time proving that you are operating as a business and going after you for taxes.

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Filed Under: Other Poker News