Virtual Currency Transaction

[mikecay]

When reporting crypto currency gains of losses for an asset that was bough in multiple transactions and sold in multiple transaction do you report the average purchase price and sale price or do I claim it as first-in/first-out (FIFO) and show it as multiple transactions?

[TheTaxSmith]

Hi mikecay.

That choice is yours. But once started you have to be consistent. In most cases you track your investment and determine the ACB as you make each purchase. That gives you an average, But really the choice is yours and you can use FIFO if you want. To support FIFO you would usually be considered as a business and doing day trading and therefore any gains and losses would be income. Using the average process you could be considered to be achieving capital gains or losses.  

[arif.mcmaster]

I prepared my crypto report using tokentax software, it generated a CSV file which contains almost 2000 transaction line, how do i put it into Ufile? In total I have $20588 capital gain. Please let me how to report my crypto income. Thanks,

[arif.mcmaster]

Hi @Nawal, thanks for your kind response. Please see the attached image. Is it okay if I just report the total proceeds and total adjusted costs? Thanks.

[arif.mcmaster]

Thank you so much. Do I have to submit/upload the TokenTax tax report to CRA after filing tax return?

[nick123]

I'll be claiming crypto gains/losses as a business expense on a T2125 based on CRA definition.   I have a small business that I already do this for.    Would it be best practice to detail the income/expenses related to crypto trading as a separate business or just all under my small business?  

I.e.; in Ufile, would I do a separate T2125 section for the crypto business?  

[TheTaxSmith]

Hi Nick123,

I assume that the crypto business is different than your other business. It would therefore be best to complete a separate business statement. You would use a NAICS code of 522390 instead. This allows CRA to distinguish the difference in the business types and could help prevent an increased review of your file. Just a suggestion.

 

[V4D3R]

I started doing crypto last year and was really worried I had to input all of my 5000+ transactions individually.

[whitewolfcan]

Hello. I am using Nicehash to mine crypto currency, and received Bitcoin as payment. I did not sell any of those bitcoins yet, so I have no date of dispostion. How do I report the transactions with UFile?

 

[Udduxbya]

You say we can enter the totals but we need a date of disposition, is it wrong to enter the last day of the year? Or do I seriously have to enter every single transaction.. 

[Reporo44]

Bitcoin transactions are messages like emails that are digitally signed using cryptography and sent to the entire Bitcoin network for confirmation. Transactions are public and can be found in a digital registry called a blockchain.
In essence, a transaction with BTC consists of three parts. The most important thing is to have the wallet data of the person you want to send the cryptocurrency to and know the exact amount. In addition, there are exchange for cryptex.net, which allow you to generate the amount you need if it is not on the account.
Good luck!

[Ramin]

Hi, 

I have filled the required information in the Virtual Currency form, having a loss of about $5000. However, this does not add anything to my total refund when I click review. I read that we are eligible to get a refund of up to $3000. Could someone please tell me what am I doing wrong?

[Geo123]

Hello Ramin,

I am unaware of any refund relating to Virtual Currency.  The Virtual Currency loss would have to applied to a capital gain or it will be carried forward.

[Taduro]

On 4/6/2021 at 11:18 PM, Nawal said:

Hi @arif.mcmaster, To report a gain or loss on your cryptocurrency transactions, please follow the procedure below:

1. In the "Left-side menu on the Interview tab", select "Interview setup".

2. On the right-hand side of the screen, go to the "Investment income and expenses" group, check for "Capital gains (or losses) and capital gain history" and click on "Next" at the bottom of the page.

3. Return to the "Left-side menu on the Interview tab", select the topic "Capital gains (or losses) & ABIL".

4. On the screen to your right, click on the plus sign "+" icon to the right of the line "Vrtual currency transactions".

5. Enter the information about the trans action. It is mandatory to indicate the "Date of disposition" as well as the "Proceeds of disposition", you should specify the ''Adjusted cost base of shares or property'', namely the cost of acquisition of the cryptocurrency the same way you should enter the cost of the ''Expenses incurred in making the disposition''.

6. In addition, if you have requested a ''Reserve on disposition'' you must specify it.

The net capital gain or loss will be reported by the program on Schedule 3 of the federal returns on line 13200 and, if applicable, on Schedule G of the Quebec returns, in the new "Virtual currency operations" section of Part A.

The capital gain will be reported on line 12700 of the federal return and, for Quebec residents, to line 139 of the Quebec return.

That is simply required, especially in the modern world. I also work to advance myself in this area, and recently, blockchain has captured my interest as well. And I discovered a resource that supports me in  https://icoholder.com/en/icos/ongoing . I'm delighted I discovered the appropriate source for this because I need specific directions and reviews because I'm new to this.

If you have incurred a loss, this will be mentioned in both the federal and Quebec notices of assessment.

Do all profits have to be reported in full?

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