How Are Cryptocurrency and Bitcoins Taxed in Canada?

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For those wondering, the Candian Revenue Agency has made it clear that yes, Bitcoins and Cryptocurrencies need to be disclosed on taxes this year. Cryptocurrency is taxed like any other investment you make in Canada.

50% of any gains are taxable and are added to your yearly income. For example, if you bought bitcoin for $2,000 and then sold it for $4,000, you would have to report a capital gain of $1,000 (50% of $2,000).

This scenario only applies to normal buying and hold investors. If you are a high volume trader the CRA may consider it a business, and you would have to file taxes accordingly.

It’s also important to note that you are only taxed on any profit from cryptocurrency. If you purchased any cryptocurrency, but haven’t sold or traded it, you do not have to pay taxes on it.

 

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