Called the CRA (Canadian tax revenue agency...)...

[spazzdla]

First person couldn't answer the question about what to do If I bought BTC and then sell at a gain what  to do. 

Get it moved up to another person, they answer treat it as a stock.  I get asked how I am going to do that since no one exchanges it..

Convo goes something kind of like this:

But it's not traded how are you going to sell it.

Yes it is there is a rather large exchange in Canada I deal with, .quadrigacx.

Oh, but no one is going to send you a check for money for btc.

Yes they will I can ask for a check from quadrigacx..




The convo kind of gets repeated about 3 times till I say I should have enough info and thank you for the help.



The bloody CRA doesn't even know about bitcoin.. 

It is very difficult to ask tax questions , etc when they know nothing about it..

I also asked if I have to pay capital gains if I buy something with it.

Well it's not a currency so that doesn't matter.. you can't buy anything with it.

WELL THAT IS WHERE YOU ARE WRONG KIDO.  I can and do buy things with it all the time, it seems I don't have to pay capital gains though if I buy things with it and make gains from my initial purchase :O!!




I feel like we are in the 1200's and people are just starting to use silver and gold to store wealth.. Then almost instantly everyone used it to exchange value..


The real point of this thread is.. this made me pretty bullish that BTC is still so small even tax agencies ignore it.

[1715414281]

1715414281

[1715414281]

1715414281

[franky1]

CRA does know about bitcoin.

but
some of the call centre guys at many government agencies are just temporarily employed staff that just take notes and ask supervisors.
their training is usually 1 hour basic knowledge and 1 day shadowing another colleague.

usually you are passed on and told to review the website or seek advice from an accountant/specialist. or asked to be put on hold while they consult their supervisor/a manual

EG even the staff at KFC dont know the colonels secret ingredient. or the calories per chicken breast. or even the type of fat its cooked in. they are just customer facing low paid employee's

[deisik]

~snipped~

The real point of this thread is.. this made me pretty bullish that BTC is still so small even tax agencies ignore it.

Could you tell us what was the point of you asking them? Are you really going to pay some taxes on Bitcoin gains (testing waters if they could really go after you) or have you been just curious (read provocative)? If a lot of people start asking such and similar questions, the tax agencies won't ignore Bitcoin any more. And this is obviously not what many of us might want...

In other words, don't trouble trouble until trouble troubles you

[spazzdla]

Future knowledge.. the gov LOVES to rape the little guy.  If they found out someone in the middle class sold something they bought for lets say $1 million and didn't tell them they would fine you $1 million PLUS gains..

So I need to tell them up front or they will go out of their way to "make an example" out of me so the other 98% knows they will get raped if they try to hide money.

I have heard some vicious stores about the CRA.

[Bungeebones]

I think the real wrench in their machine will be when people ask them for the legal definition of "dollar". I'm confident (not positive) that the same thing happened in Canada where they started referring to PROMISES to pay dollars as DOLLARS. Obviously, an object (i.e a "note") that promises to pay a "dollar" cannot itself be a dollar!

Just because something was declared "legal tender" it didn't make the promise to pay a dollar an actual dollar. What legal tender accomplished was to force someone to accept a note (promise to pay a dollar) in lieu of a real dollar (sort of like forcing someone to accept a bad check).

By treating Bitcoin as property, they cause the person trading it to determine its value compared to "dollars". If they wanted the people to compare and report its value related to "notes" then they certainly could have done so (since they create the tax forms). And since they are legal instruments that are signed "under penalties of perjury" the language needs to be strictly construed. Using street slang definitions of "dollar" is not sufficient. Diligent taxpayers must make sure they use the right measure, the right "dollar" to measure their gain against.

Here, in the US, the official, legal dollar is a one ounce silver coin still issued legally under authority of the US Congress and the US Mint. One, legal, official dollar "sells" for approximately $20 worth of Federal reserve Worthless Notes.

Therefore, to get the value of Bitcoin (and any gain) divide the market price in FRN and divide by 20. That is a lot less tax and really quite bearable. The problem for the taxing officials is if a dollar is, indeed, a silver coin then no one earns dollars and only earn promises to pay dollars that are never delivered upon. That would not be good for tax receipts if everyone reported their taxable income in legal dollars

[spazzdla]

I just found this thread..

Please stop informing the CRA about bitcoin.

As far as they know, Bitcoin is an intangible asset.

If you want to collect tax and send it to them, they will gladly take your money..

But, for the love of Bitcoin, don't tell them that you can get MONEY for it!

The gov of Canada is very friendly towards BTC.  Our senate has spent over 10 hours in meetings with people about bitcoin.  Check out the youtube video with the senate talking to Andreas A.

When (not if) BTC gets to $10 CAD the CRA will know all about Bitcoin. 

Don't try to cheat the CRA that is the best advice you will ever get on this planet.

[deisik]

I just found this thread..

Please stop informing the CRA about bitcoin.

As far as they know, Bitcoin is an intangible asset.

If you want to collect tax and send it to them, they will gladly take your money..

But, for the love of Bitcoin, don't tell them that you can get MONEY for it!

The gov of Canada is very friendly towards BTC.  Our senate has spent over 10 hours in meetings with people about bitcoin.  Check out the youtube video with the senate talking to Andreas A.

When (not if) BTC gets to $10 CAD the CRA will know all about Bitcoin. 

Don't try to cheat the CRA that is the best advice you will ever get on this planet.

It is typically more like "don't mess with the IRS"

And how much is the capital gains tax in Canada, and are there any exemptions, for example, when you hold the assets for longer than a certain period of time? I guess as long as you don't convert your bitcoins to fiat there is no need to pay this tax. On the other hand, since you are calling the CRA not for the fun of it (at least, so you say), we can assume that you are going to do just that (i.e. pay some taxes if you have to). I'm not suggesting you go for tax evasion (but others may still be interested in exactly that), but what about opening an offshore account (provided you really have that much as you imply)? Did you investigate this option?

[Sithara007]

And how much is the capital gains tax in Canada, and are there any exemptions, for example, when you hold the assets for longer than a certain period of time?

Capital gains tax calculation is a bit complex in Canada. 50% of realized capital gains are taxable in Canada at an individual's tax rate, so it works out to a maximum of 20% to 27% of the gains (depending on the state/territory). Unrealized capital gains are not taxed.

[Juggy777]

I don't understand why would you want to pay tax on Bitcoin? First of all its not Canada currency. Two there no rule that says you need to pay your tax on btc. It's decentralised for a reason and no country can charge a tax in it until they have a valid law. You should call a law firm and ask did Canada over night make a law to charge tax on Bitcoin, you seem so panicky may I know why. All this time you would have traded without fear. So why wake up suddenly?

[Xester]

Tax agencies is not ignoring bitcoin. The reason why they cannot tax bitcoin since there are no guidelines and tariff regarding bitcoin taxation. Some government taxing agencies do not tax bitcoins but the moment you exchange your bitcoin to fiat, the site or exchanger will place fees on your transaction that will serve as your tax since it will go to the government treasury.

[deisik]

I don't understand why would you want to pay tax on Bitcoin? First of all its not Canada currency. Two there no rule that says you need to pay your tax on btc. It's decentralised for a reason and no country can charge a tax in it until they have a valid law. You should call a law firm and ask did Canada over night make a law to charge tax on Bitcoin, you seem so panicky may I know why. All this time you would have traded without fear. So why wake up suddenly?

You don't pay taxes on Bitcoin in particular

You pay taxes on capital gains. The latter are profits that you obtain from buying something at one price and selling it later at a higher price. The difference will be a capital gain, and that is taxed. That something can in fact be anything which is not specifically taxed, and Bitcoin cuts pretty well in this respect. Whether Bitcoin is a Canadian currency, or currency at all is irrelevant for taxation

Tax agencies is not ignoring bitcoin. The reason why they cannot tax bitcoin since there are no guidelines and tariff regarding bitcoin taxation. Some government taxing agencies do not tax bitcoins but the moment you exchange your bitcoin to fiat, the site or exchanger will place fees on your transaction that will serve as your tax since it will go to the government treasury.

I'd rather say it is prohibitively expensive for them to go after every Bitcoin tax evader right now, but that doesn't mean they won't try to make an example of some poor fellow, a scapegoat of sorts, and punish him in full

[spazzdla]

I don't understand why would you want to pay tax on Bitcoin? First of all its not Canada currency. Two there no rule that says you need to pay your tax on btc. It's decentralised for a reason and no country can charge a tax in it until they have a valid law. You should call a law firm and ask did Canada over night make a law to charge tax on Bitcoin, you seem so panicky may I know why. All this time you would have traded without fear. So why wake up suddenly?

You most certainly do have to pay tax.  I haven't traded just bought.  ANYTHING you buy and then sell for cash and make money on you must pay capital gains.  


As deisik  just said.. I don't want to be the guy that doesn't tell the CRA then I am on the news the next day,  everything taken from me and looking at years in prison because they are cucks.  

The tax man is a bastered with an army behind him.. do not try to fuck him or he will fuck you so hard you can never walk again.


*EDIT*
Sorry I like my "colourful" language.

[deisik]

I don't understand why would you want to pay tax on Bitcoin? First of all its not Canada currency. Two there no rule that says you need to pay your tax on btc. It's decentralised for a reason and no country can charge a tax in it until they have a valid law. You should call a law firm and ask did Canada over night make a law to charge tax on Bitcoin, you seem so panicky may I know why. All this time you would have traded without fear. So why wake up suddenly?

You most certainly do have to pay tax.  I haven't traded just bought.  ANYTHING you buy and then sell for cash and make money on you must pay capital gains. 


As deisik  just said.. I don't want to be the guy that doesn't tell the CRA then I am on the news the next day,  everything taken from me and looking at years in prison because they are cucks. 

The tax man is a bastered with an army behind him.. do not try to fuck him or he will fuck you so hard you can never walk again

That was rude but true

Some have tried, many have failed. If you don't want to pay taxes (I doubt there is anyone willing to pay them unless cornered) and don't want to get caught at that, I guess you may consider buying citizenship of a country which doesn't impose taxes on bitcoins or capital gains obtained through currency exchange operations and as well has a double taxation agreement signed with Canada. Then you might declare your income in that country, and thus free your gains from taxation in Canada. A financial (tax) adviser or consultant would be of great help here, provided it is worth trying, of course

[spazzdla]

I feel like we are in the 1200's and people are just starting to use silver and gold to store wealth.. Then almost instantly everyone used it to exchange value..


The real point of this thread is.. this made me pretty bullish that BTC is still so small even tax agencies ignore it.

buy buy buy

I'm still a newb at bitcoin, but it doesn't take a genius to know its a good hodl


"  hodlers and whales assembled to soak up the BearWhale’s coins, successfully slaying it. This event was commemorated with artwork of the battle, such as the picture atop this post. "

https://qz.com/878728/buy-and-hodl-just-dont-get-rekt-the-slang-that-gets-you-taken-seriously-as-a-bitcoin-trader/

BUYING ALL THE COINS!!!!!.

I will never sell all of my coins but I do plan to sell some on the way up.

[LeGaulois]

I had a similar problem.
They don't know, or at least most of them don't. When i first called the guy i needed to explain it to him....and more than 1 time.

Finally the guy replied, stop to trolling me !

I left the converstaion. I figured out my anwser searching by myself into gov release papers wich i can read online

[olubams]

I tell you, its not only CRA that does not know even over here, police can arrest you if you proudly say you are dealing in bitcoin and they might intepret it to mean that its being used in the "underworld" thereby you are doing something illegal and that is why those who deal in this currency do it via faceless forum to avoid such confrontations. And that is the long way I always see when people start comparing bitcoin with bank or with fiat claiming bitcoin will replace fiat or even kill banks...

[roadcrap]

http://pasteboard.co/kVXvBSuLE.png


/meme philosoraptor If I mention the CRA ; Will Canadians flock to this thread?

[unamis76]

The CRA was pretty clear, they told you that it's not a currency neither can anyone send you a check for BTC, so I see no reason for doubts. They seem to know quite a lot about Bitcoin after all...

As for you feeling we're in the 1200's, well... I guess you'll have to get used to that

[Believe13]

I am confused here.  So if I don't convert coins to Fiat then i don't need to declare anything to them?

I have discussed with accountant. and he has no clue what I was talking about !!

[Melfear]

After many hours searching online, you do have to pay taxes on EVERY trade you made profit with!! Trading, for example, BTC for ETH is the same as trading BTC to CAD and CAD to ETH. You have to pay the tax on capital gain for the BTC "sell". For now i'm not sure of the method that is recommend in Canada to determine the initial value of the BTC used to buy the ETC if you have bought/acquire BTC over the time at different prices. I have found 3 ways to do this. The First In First Out, the Last In Last Out and the average buy price. I'm not sure which one to use in Canada ... For tax, capital gain is taxes at your marginal rate for half the amount of gain which is calculate with a simple formula : Sell price minus fees MINUS Buy price with fees = Capital gain. Be aware that a person buying and holding for more than a year is consider a long time trader and the income is a capital gain. For those who trades (buy and sell) inside a single year, they can be flag as "professional trader" and the profit made on each trade is becoming like a job income and is all tax at your marginal rate!!

And now the disclaimer, I'm just a small trader and i'm not a financial/accountant professional in anyway, my personnal advise is if you want to be save, declare your income, pay your tax and keep proof of your trades as sign of good will. That way you will keep CRA far from you even if they ask you proof, send them and you will never hear from them again. To be sure always ask for professionnal help (wich is really hard to get for something virtual like bitcoin)!

Enjoy!

Edit : Here a link for a PDF made by 2 professionnal
Olivier Fournier. Deloitte Tax Law ll p, Montreal. Frequent
speaker, writer, and presenter at tax conferences and seminars.

John J. Lennard. Davies Ward Phillips & Vineberg ll p,
Montreal. bcomm (2007) Laurentian University; bcl , ll b
(2011) McGill University.

https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=8&ved=0ahUKEwj8n867y-vVAhVGLSYKHR5qCH0QFgheMAc&url=https%3A%2F%2Fwww.dwpv.com%2Fassets%2F-%2Fmedia%2FF28E60C148DB463DB31E0CF66008FD2A.ashx&usg=AFQjCNE-1eNUL1Mt0Kv2W7a6nhr-jyfOnQ

[megashira1]

After many hours searching online, you do have to pay taxes on EVERY trade you made profit with!! Trading, for example, BTC for ETH is the same as trading BTC to CAD and CAD to ETH. You have to pay the tax on capital gain for the BTC "sell". For now i'm not sure of the method that is recommend in Canada to determine the initial value of the BTC used to buy the ETC if you have bought/acquire BTC over the time at different prices. I have found 3 ways to do this. The First In First Out, the Last In Last Out and the average buy price. I'm not sure which one to use in Canada ... For tax, capital gain is taxes at your marginal rate for half the amount of gain which is calculate with a simple formula : Sell price minus fees MINUS Buy price with fees = Capital gain. Be aware that a person buying and holding for more than a year is consider a long time trader and the income is a capital gain. For those who trades (buy and sell) inside a single year, they can be flag as "professional trader" and the profit made on each trade is becoming like a job income and is all tax at your marginal rate!!

And now the disclaimer, I'm just a small trader and i'm not a financial/accountant professional in anyway, my personnal advise is if you want to be save, declare your income, pay your tax and keep proof of your trades as sign of good will. That way you will keep CRA far from you even if they ask you proof, send them and you will never hear from them again. To be sure always ask for professionnal help (wich is really hard to get for something virtual like bitcoin)!

Enjoy!

Edit : Here a link for a PDF made by 2 professionnal
Olivier Fournier. Deloitte Tax Law ll p, Montreal. Frequent
speaker, writer, and presenter at tax conferences and seminars.

John J. Lennard. Davies Ward Phillips & Vineberg ll p,
Montreal. bcomm (2007) Laurentian University; bcl , ll b
(2011) McGill University.

https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=8&ved=0ahUKEwj8n867y-vVAhVGLSYKHR5qCH0QFgheMAc&url=https%3A%2F%2Fwww.dwpv.com%2Fassets%2F-%2Fmedia%2FF28E60C148DB463DB31E0CF66008FD2A.ashx&usg=AFQjCNE-1eNUL1Mt0Kv2W7a6nhr-jyfOnQ

"For those who trades (buy and sell) inside a single year, they can be flag as "professional trader" and the profit made on each trade is becoming like a job income and is all tax at your marginal rate!!"

Any more information regarding the definition of a professional trader? I'm sure most people within the crypto space have made trades at one time or another (just look at the trading volumes).

Does this make almost everyone within the crypto space a professional trader as per the CRA?

If people knew you would get tax'd at your marginal rate and not at the capital gains rate i'm sure many would not engage in trading to begin with.

If the CRA see's you invested into 10 Bitcoins in 2013 and now cashout 20 Bitcoins, and you show evidence that you engaged in trading to increase your total Bitcoins, does this guarantee you to be nabbed as a trader? What if you made only 1 trade? 10 trades? 100 trades?

Also, what if one has incomplete records regarding their crypto history but it is obvious that they made $ either by gambling, trading, donations et al and they now want to cash out?

[BCMB]

After many hours searching online, you do have to pay taxes on EVERY trade you made profit with!! Trading, for example, BTC for ETH is the same as trading BTC to CAD and CAD to ETH. You have to pay the tax on capital gain for the BTC "sell". For now i'm not sure of the method that is recommend in Canada to determine the initial value of the BTC used to buy the ETC if you have bought/acquire BTC over the time at different prices. I have found 3 ways to do this. The First In First Out, the Last In Last Out and the average buy price. I'm not sure which one to use in Canada ... For tax, capital gain is taxes at your marginal rate for half the amount of gain which is calculate with a simple formula : Sell price minus fees MINUS Buy price with fees = Capital gain. Be aware that a person buying and holding for more than a year is consider a long time trader and the income is a capital gain. For those who trades (buy and sell) inside a single year, they can be flag as "professional trader" and the profit made on each trade is becoming like a job income and is all tax at your marginal rate!!

And now the disclaimer, I'm just a small trader and i'm not a financial/accountant professional in anyway, my personnal advise is if you want to be save, declare your income, pay your tax and keep proof of your trades as sign of good will. That way you will keep CRA far from you even if they ask you proof, send them and you will never hear from them again. To be sure always ask for professionnal help (wich is really hard to get for something virtual like bitcoin)!

Enjoy!

Edit : Here a link for a PDF made by 2 professionnal
Olivier Fournier. Deloitte Tax Law ll p, Montreal. Frequent
speaker, writer, and presenter at tax conferences and seminars.

John J. Lennard. Davies Ward Phillips & Vineberg ll p,
Montreal. bcomm (2007) Laurentian University; bcl , ll b
(2011) McGill University.

https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=8&ved=0ahUKEwj8n867y-vVAhVGLSYKHR5qCH0QFgheMAc&url=https%3A%2F%2Fwww.dwpv.com%2Fassets%2F-%2Fmedia%2FF28E60C148DB463DB31E0CF66008FD2A.ashx&usg=AFQjCNE-1eNUL1Mt0Kv2W7a6nhr-jyfOnQ

"For those who trades (buy and sell) inside a single year, they can be flag as "professional trader" and the profit made on each trade is becoming like a job income and is all tax at your marginal rate!!"

Any more information regarding the definition of a professional trader? I'm sure most people within the crypto space have made trades at one time or another (just look at the trading volumes).

Does this make almost everyone within the crypto space a professional trader as per the CRA?

If people knew you would get tax'd at your marginal rate and not at the capital gains rate i'm sure many would not engage in trading to begin with.

If the CRA see's you invested into 10 Bitcoins in 2013 and now cashout 20 Bitcoins, and you show evidence that you engaged in trading to increase your total Bitcoins, does this guarantee you to be nabbed as a trader? What if you made only 1 trade? 10 trades? 100 trades?

Also, what if one has incomplete records regarding their crypto history but it is obvious that they made $ either by gambling, trading, donations et al and they now want to cash out?

I would be curious to hear from someone who has been flagged as a professional trader by the CRA unknowingly. I know this can be an issue with frequent trades made inside tax sheltered accounts such as a TFSA as well (where there would normally be no tax). It seems like the guidelines around this are verrrrry vague. I wouldn't be surprised if just a few buy/sells per day would get you flagged.

[megashira1]

Also, what if you have been trading cryptos and THEN hold for 1 year after your last trade? Would it be deemed capital gains or income?

[BCMB]

Also, what if you have been trading cryptos and THEN hold for 1 year after your last trade? Would it be deemed capital gains or income?

I think it would largely depend on if you ever transferred to CAD/USD during that time.

[megashira1]

Also, what if you have been trading cryptos and THEN hold for 1 year after your last trade? Would it be deemed capital gains or income?

I think it would largely depend on if you ever transferred to CAD/USD during that time.

After re-reading Melfear's post, I'd be paying tax on my gains made through trading at my marginal tax rate. If I then hold those coins for 1 year after my last trade those subsequent gains would be taxed at the capital gains rate.

Most people don't believe you have to pay tax on trading until you solidify your gains into fiat, and that those gains will be taxed as capital gains not income. This is not true.

fyi being taxed as income as opposed to capital gains is double the amount of tax on your earnings. So much for easy crypto profits.

With this in mind a lot of speculative plays are no longer as appealing given the newly understand risk:reward ratio

[BCMB]

Also, what if you have been trading cryptos and THEN hold for 1 year after your last trade? Would it be deemed capital gains or income?

I think it would largely depend on if you ever transferred to CAD/USD during that time.

After re-reading Melfear's post, I'd be paying tax on my gains made through trading at my marginal tax rate. If I then hold those coins for 1 year after my last trade those subsequent gains would be taxed at the capital gains rate.

Most people don't believe you have to pay tax on trading until you solidify your gains into fiat, and that those gains will be taxed as capital gains not income. This is not true.

fyi being taxed as income as opposed to capital gains is double the amount of tax on your earnings. So much for easy crypto profits.

With this in mind a lot of speculative plays are no longer as appealing given the newly understand risk:reward ratio

I think a large part of the belief that you don't pay tax on gains until you transfer to fiat is that it is going to be much, much more difficult for a governing body to actually track your trades between alt coins, at least for the near future. The CRA isn't going to know about your trades on Bittrex, but you can bet they will be notified when you cash out of Quadriga. I wonder what would happen if you claimed you doubled your BTC via gambling, but had no proof?

[Clamking33]

Hi

Just saw this and it seems there's a lot of disagreement and there should and will be for obvious reasons.  I just wanted to add my 2 cents about the cra.

U do not have to report bitcoin or cash if you are not depositing it into a bank.  I actually just got finished my year of frozen bank accounts and credit cards dealing with the cra.  Ur chances of winning against them let's just say are slim to none of course there are rare cases.

That being said if u cash your bit coin where are you going to keep your cash under a pillow hidden.  This is actually what a lot of people do with large amounts of cash.  The rule of thumb in Canada used to be any deposit that is equal to or over 10000 dollars has to be reported to fintrac.  I think they changed this law this year and now banks have to notify the cra deposit in cash over 3 thousand dollars if they deem it suspicious what ever this means.  I'm not 100percent sure of my last statement but I believe during my research last year I read it. 
That being said even if reported if it is from bitcoin I'm not sure what they will or can do.  This is probably a case by case thing with the cra what ever they do it will probably be a lengthy headache for the person depositing the cash.  The only way a large sum transaction isn't reported is if it's from a public body
Ie. The government municipality hospital etc. Or a financial institution like a bank.
After reporting to the cra it doesn't mean they will act but when it comes to tax time you never know what will happen.  Believe me I went through a year of suffering. So in conclusion I believe the question about taxing bitcoin is legitimate if you decide to put the cash or check into a bank

Edit
For any confusion my account wasn't frozen due to bitcoin but I have been trading crypto for years and making a living off of it.  I also won money at a couple casinos and had a import export business with large wire transactions going in and out.  They audited me said I owed 68000 dollars.  Which was ridiculous so I had to deal with the cra.  U definitely do not want to get audited.  They audited me 3 more times after because I sent them legitimate paperwork and got accountants involved. How ever this took a year and the cra switched there's collection agent on me 5 times and each time I had to report the exact same thing over and over this process took a year and my final owing being less than 3000 dollars and my credit in shambles due to not being able to make any credit card payments or use a bank.  So yes if u have bitcoin and plan on cashing them in MAKE SURE you do some research contact an accountant and the cra. I plan on cashing some bitcoin in soon but honestly I'm freaking hesitant lol. When you ask the cra they may not know a thing about bit coin but when time comes and the agent that didn't know a thing about bitcoin sees a large sum of money in an account what do you think the government will do.  Hmm this guy has a lump some of money not reported if it's taxable we need to take as much a we can now the agent with little knowledge gets booted off the case and in comes the government of Canada...whether they know nothing or something about bitcoin doesn't matter at this point.  Chances are even if you are able to keep all your money your gonna have to do a bunch of things that you more than likely don't want to do because you shouldn't have too but that's the way it goes

[Sandwichstealer]

It’s my understanding that bitcoin is considered a property. If you’re familiar with trading stocks use the same rules and tax forms.

Keep a record of all transactions. Record the fiat equivalent value.

If you make interest, report the interest every year. It will be taxed at your highest tax rate.

Declare capital gains and capital losses. If you take a loss, take advantage of that loss! Capital calculations are made at the time of sale.

When you purchase or sell a stock the record indicates number of units and share price. Bitcoin transaction records should be the same.

If you have a record of 2 purchased units, make sure you have a record of 2 sold units to balance the books.

I’m not an accountant but you should ask one first. You might get audited, have the documentation to back it up.

[alphabetacanary]

I don't understand why would you want to pay tax on Bitcoin? First of all its not Canada currency. Two there no rule that says you need to pay your tax on btc. It's decentralised for a reason and no country can charge a tax in it until they have a valid law. You should call a law firm and ask did Canada over night make a law to charge tax on Bitcoin, you seem so panicky may I know why. All this time you would have traded without fear. So why wake up suddenly?

Wow.  This ignorance is amazing.  There absolutely are rules about BTC and taxation.  Both capital gains tax laws and income tax laws apply to bitcoin. 

If you do a job for me, there is nothing stopping me from paying you in chickens.  You renovate my bathroom, I give you chickens in return.  Now, according to your logic, chickens are not Canadian currency and therefore aren't subject to tax.  Wrong.  The rules are very clear and always have been.  You must declare those chickens at fair market value are the time you received them as income AND PAY INCOME TAX.  The same goes for BTC.

Similarly, buying/selling BTC? They are treated as a commodity and subject to capital gains tax or you can submit loss claims. You may not AGREE with those rules, but they are there and always have been.  If you don't follow them, that makes you a TAX EVADER. History shows tax evasion does not end well for those who get caught. 

https://www.canada.ca/en/revenue-agency/news/newsroom/fact-sheets/fact-sheets-2015/what-you-should-know-about-digital-currency.html

I am positive the CRA is quietly amassing large amounts of data on transactions to Canadians from the exchanges and will make an example out of the people who think they can buy/sell BTC without paying their taxes.  Ignorance will not be a defence.

[megashira1]

Anyone have experience cashing out? How did you report your gains?

[markeee]

Regarding Fintrac, it's basically amounts of $10k only. That's the magic number. Best to keep it under and no red flags appear I guess...

More details here: http://www.fintrac-canafe.gc.ca/reporting-declaration/rpt-eng.asp

I wonder how we report our mining cryptocurrencies. I mine with NiceHash and collect BTC. Sigh.... I hate the fact the CRA remains vague, but can still hold us accountable.... yet you can't get clear instructions to follow.

 

Hi

Just saw this and it seems there's a lot of disagreement and there should and will be for obvious reasons.  I just wanted to add my 2 cents about the cra.

U do not have to report bitcoin or cash if you are not depositing it into a bank.  I actually just got finished my year of frozen bank accounts and credit cards dealing with the cra.  Ur chances of winning against them let's just say are slim to none of course there are rare cases.

That being said if u cash your bit coin where are you going to keep your cash under a pillow hidden.  This is actually what a lot of people do with large amounts of cash.  The rule of thumb in Canada used to be any deposit that is equal to or over 10000 dollars has to be reported to fintrac.  I think they changed this law this year and now banks have to notify the cra deposit in cash over 3 thousand dollars if they deem it suspicious what ever this means.  I'm not 100percent sure of my last statement but I believe during my research last year I read it. 
That being said even if reported if it is from bitcoin I'm not sure what they will or can do.  This is probably a case by case thing with the cra what ever they do it will probably be a lengthy headache for the person depositing the cash.  The only way a large sum transaction isn't reported is if it's from a public body
Ie. The government municipality hospital etc. Or a financial institution like a bank.
After reporting to the cra it doesn't mean they will act but when it comes to tax time you never know what will happen.  Believe me I went through a year of suffering. So in conclusion I believe the question about taxing bitcoin is legitimate if you decide to put the cash or check into a bank

Edit
For any confusion my account wasn't frozen due to bitcoin but I have been trading crypto for years and making a living off of it.  I also won money at a couple casinos and had a import export business with large wire transactions going in and out.  They audited me said I owed 68000 dollars.  Which was ridiculous so I had to deal with the cra.  U definitely do not want to get audited.  They audited me 3 more times after because I sent them legitimate paperwork and got accountants involved. How ever this took a year and the cra switched there's collection agent on me 5 times and each time I had to report the exact same thing over and over this process took a year and my final owing being less than 3000 dollars and my credit in shambles due to not being able to make any credit card payments or use a bank.  So yes if u have bitcoin and plan on cashing them in MAKE SURE you do some research contact an accountant and the cra. I plan on cashing some bitcoin in soon but honestly I'm freaking hesitant lol. When you ask the cra they may not know a thing about bit coin but when time comes and the agent that didn't know a thing about bitcoin sees a large sum of money in an account what do you think the government will do.  Hmm this guy has a lump some of money not reported if it's taxable we need to take as much a we can now the agent with little knowledge gets booted off the case and in comes the government of Canada...whether they know nothing or something about bitcoin doesn't matter at this point.  Chances are even if you are able to keep all your money your gonna have to do a bunch of things that you more than likely don't want to do because you shouldn't have too but that's the way it goes

[justgonnalook]

I just want to add, you guys should head over to https://coinforum.ca/discussion/4635/bitcoin-and-taxes-in-canada-ask-your-questionscan. All tax questions will be collected and then given to a professional accountant. They will post the answers after. This year will be a bitch for taxes. Happy HoDLdays!

[OhMyHolyToken]

Hypothetical questions:

So, cashout 9000$ once a week is OK? Bank won't report that to CRA?

Quadrigacx won't report anything?

If I'll sell BTC for 30 000 and buy a gold for 30 000, without any capital gain, is OK for CRA?

How you guys cashout your crypto without involving CRA?

Thanks

[mOgliE]

Hi,

Most governmental agencies do know about bitcoin... They just wonder how to deal with it... The bitcoin is not a real money, it is a digital currencies with rather chaotic trends...

As most governments think that for the moment, it is better to ignore bitcoin, of course institutionnal concerns cannot be adressed.

Yet, for you it can be a good thing. If there is nothing in the law, it is not illegal, so take advantage of it!

[megashira1]

Hypothetical questions:

So, cashout 9000$ once a week is OK? Bank won't report that to CRA?

Quadrigacx won't report anything?

If I'll sell BTC for 30 000 and buy a gold for 30 000, without any capital gain, is OK for CRA?

How you guys cashout your crypto without involving CRA?

Thanks

Consistent sums under the FINTRAC reporting threshold will get flagged as suspicious and reported anyways. Assume every $ that enters your bank account will be reported to the CRA.

BTC for Gold would act as a disposition of Crypto for another Asset triggering tax implication.

Crypto to Crypto as it currently stands seems like a Gray area when it comes to the law and tax implications. This area can be exploited to reduce once tax implications I believe.