Last updated October 5, 2026
No. In Canada, lottery winnings aren't taxable income. The Canada Revenue Agency (CRA) lists lottery winnings of any amount among the amounts you don't report or pay tax on. That includes national lotteries, provincial games, and hospital and charity lotteries.
But some things connected to a win are taxed. Here are the main ones.
Interest and investment income
Once you've won, what your money earns is taxable like anyone else's. The CRA says interest you earn by investing lottery winnings must be reported. The same goes for dividends, and for capital gains when you sell investments for more than you paid.
Life prizes like Daily Grand
With a prize paid over time, such as Daily Grand's $1,000 a day for life, each payment is mostly the prize itself, which isn't taxed. Part of each payment can be investment income, which is taxable. The organization paying the prize will send you a tax slip showing the taxable amount.
Sharing your winnings with family
Canada has no gift tax, so the people you give money to don't pay tax on it. But watch the attribution rules:
- If you give money to your spouse or common-law partner, the investment income and capital gains they earn on it can be taxed back to you.
- If you give money to a child, niece or nephew under 18, the interest and dividends it earns can be taxed back to you until they turn 18. Capital gains aren't.
- Gifts to adult children generally aren't subject to these rules.
Giving away property such as shares or real estate, rather than cash, can also trigger capital gains tax for you.
Group wins
If a group claims a prize together, with a group claim form signed before or at the claim, each person's share is their own tax-free winnings. If one person claims everything and then hands out money, those payments are gifts, and the attribution rules above can apply.
Prize homes and cars
Winning a home or car in a hospital or charity lottery isn't taxable. If you later sell a prize home for more than it was worth when you won it, the gain can be taxable, unless the home qualifies as your principal residence because you really lived in it.
US lotteries (Powerball, Mega Millions)
US wins are different. The US generally withholds 30% tax from lottery winnings paid to Canadian residents. Under the Canada–US tax treaty, Canadians can deduct US gambling losses against US gambling winnings by filing a US non-resident tax return, which can get some of that tax back. You'll need a US taxpayer number (ITIN) to do it.
According to the CRA, you don't report US lottery winnings on your Canadian tax return, and you can't claim a credit for the US tax withheld. US tax rules for gambling losses changed in 2026, so get advice from a cross-border tax professional.
Estates
Canada has no inheritance tax. Instead, when someone dies, they're treated as having sold their investments and property at market value, and tax is due on any gains, except for property left to a spouse, which can usually pass tax-deferred. Provincial probate fees may also apply.
Get professional advice
Lottery.ca isn't a tax advisor, and this guide is general information. If you win a large prize, talk to an accountant or financial planner before you invest or give money away. For the official rules, see the CRA's page on amounts that are not reported or taxed.