By Kevin Walsh.
Since 2017, there has been a dramatic rise in cryptocurrency transactions such as Bitcoin and other blockchain-based cryptocurrencies.
The CRA continues to consider cryptocurrencies to be property for Canadian income tax purposes. Accordingly, any trades or sales must be reported on your income tax return.
Whether the gains and losses from the disposition of cryptocurrencies are considered to be capital gains or ordinary income will depend on whether the cryptocurrencies are considered to be capital property. This is a question of fact and will largely depend on the intention for which the property was purchased.
Finally, cryptocurrencies situated, deposited or held outside of Canada are considered Specified Foreign Property. They will be subject to the foreign reporting requirements, and must be reported on Form T1135 – Foreign Income Verification Statement.
If you entered into transactions involving cryptocurrencies during the year, it is important to identify this to your tax professional so that they can discuss the tax consequences with you in greater detail.
Posted in Tax Tips for 2018 Tax Year
- Client News
- Estate Planning
- Film & Television
- Industry News
- Seminars + Presentations
- Strategic Insights
- Success Stories
- Tax Legislation
- Tax Tips for 2016 Tax Year
- Tax Tips for 2017 Tax Year
- Tax Tips for 2018 Tax Year
- Tax Tips for 2019 Tax Year
- Walsh King
- Walsh King Company Culture
- Walsh King News
- COVID-19: Our Commitment to Our Clients and Community
- Top 10 Business, Tax and Accounting Challenges for Transportation Businesses
- The Benefits of Working at a Midsize Firm
- Waiting for CFE Results? Here’s How to Manage Your Stress
- A Steady Hand: Let Walsh King Be Your Temporary Controller
- The Value of a Business Valuation