The first point is that lottery winnings do not need to be included in taxable income and can be considered tax-free. As well, most "prizes" or "gifts" won in contests are also tax-free. This includes those millions you might win through sports betting pools.

Did you know there is a federal Athletic Contests and Events Pools Act? The amount of skill involved in sports pools distinguishes them from lotteries and events like radio station prize draws, even though these require winners to answer a "skill-testing question." (CRA does not consider adding 43 and 27 to be an actual "skill.")

Prizes or gifts are taxable if they come from your employer and are only available to employees. As well, if you are in an occupation that competes for such prizes, your prize is generally taxable. Think of a professional athlete or spelling bee contestant. They would generally be expected to declare prize money (though wouldn't it be a shame to correctly spell "antidisestablishmentarianism" and then find your $50,000 prize is taxable?)