Canada tax and cryptocurrencies

Hi, I’m in Canada and I’m curious how to report taxes on crypto’s i’ve earned from selling osrs gp. I have 90% of my crypto on binance and am just not sure what to do. Do I claim it as personal tax or should i be setting up a corporation or business and claiming it as that? Can any educated exeperienced Canadians help me out?

 

If it's under 11k they wont even come after you for it. So personal if you're worried about it and it's under. If it's over you definitely want to file it 100% and I'd probably still claim it as personal. The only reason you'd want to do it under corporation/business would be if there's things you can write off in my opinion. I'm not a expert or a financial adverser though just a fellow canadian who know's a little about taxes

 

How is Cryptocurrency Taxed in Canada? - Money We Have

 

Its over $11k. Also cryptos are taxes as capital gains tax at 50%, but if I just recieve crypto, sell it and then transfer it to a bank is that recognized the same as being paid? Instead of capitals gains tax?

 

Below is general information about crypto for Canadians. It does not take into account that you sold OSRS gold to end up with crypto. If you have a source that says crypto's are taxed at 50% I'd like to see it.

Spoiler

Capital Gains:

It is not a black and white line whether you will get away with capital gains tax or not. If you buy crypto, and sit on it for a longer period of time, you have a stronger case. If you are buying and selling frequently your case becomes weaker the more frequently you trade.

Chance of being audited:

The government goes after "hot topics" pretty aggressively. During the real estate boom a few years back the tax break related to a home being a "residence" was widely being abused. The government hired 100s of new people to drive around and monitor houses to see if they actually had people living in them.

If you have used any of the Canadian exchanges, this is the easiest way for the government to get your information when they decide to review crypto. Evading taxes is a bad idea. Evading if you used a Canadian exchange, is playing with fire.

If you declare as capital gains, it is possible that they'll go after that as well. If trading takes up a "considerable amount of your time" they'll argue that it's your job. As a job, you are responsible for paying up to ~53% income tax.

There is a 3 year window in which the government can come after you once you file your taxes. The 3 year period only applies if you are not involved in anything they deem to be malicious. If you are filing wrong purposely, or evading in any form, they can come after you at any point after the 3 year period. The penalty is 5% yearly interest on the outstanding initial amount. It compounds daily.

Source: I had a meeting with 3 of the upper team members at EY in January. Each had a different area they specialized in. This information is a summary of some of the topics we discussed.

 

Thanks for the information. I only mean 50% when 8 was talking about capital gains. By the sounds of it I just declare it as personal income to avoid any issues...

 

The first thing you should do is not keep 90% of your crypto on an exchange, then worry about taxes after that.

 

you are probably right lol