Do you charge HST if we pay by crypto?
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Do you charge HST if we pay by crypto?
Yes and no. The owner of a particular address may be anonymous, but the transactions themselves can 100% be tracked in the blockchain. If a name then happens to get tied to said address, every transaction made from that address can be tracked in full.Originally Posted by PatchRat
A lot of exchanges have “Know you customer” policies/laws which must be followed and tie your account to you.
Great news - which cryptos? Couldn't find info on the site.
This is where I was going with this. I'm sure all retailers will claim it, as I would, of course.
I guess I'm wondering how it would be business income, because it really isn't in the form of legal tender. I can see where the government would want to see it that way, but since no one is required to accept cryptocurrency, it's value is questionable to say the least.
Since it is not legal tender, they treat it as a barter transaction for tax purposes... for both parties.
From their standpoint, if I buy 1 BTC for $1...then use that 1 BTC to buy something and BTC is now worth $100... I still have tax to pay on the $99 gain which I got. That $99 could be taxed as a capital gain, or it could be taxed as income. That will depend on whether they deem that I am an investor or a trader. Which bucket you land in there... well that can get convoluted.
If I understand it right, if you bought 1btc for $1 and pay in BTC then it's barter and no tax. If you cash out and value is higher than $1 then you pay taxes. Go to cra web site and search for crypto info there.
https://www.canada.ca/en/revenue-agency/programs/about-canada-revenue-agency-cra/compliance/digital-currency/cryptocurrency-guide.html
Last edited by CeeZer; 03-11-2021 at 07:12 PM.
There is no greater tyranny than that which is perpetrated under the shield of the law.
Guys, crypto is tracked and taxed by the feds. you buy it, receive it in a registered account that is linked to your social like a TFSA or RRSP. If you buy or hold crypto and it increases in value it’s increased value is taxed as capital gains. The one thing I don’t understand is once you take it off the exchange (in a cold wallet), how can they track what you have or what it sold for?
"This year will go down in history. For the first time, a civilized nation has full gun registration! Our streets will be safer, our police more efficient, and the world will follow our lead into the future."
Adolf Hitler, 1935
Barter transactions are taxable events.
When you take your crypto offline, you can still generate “unsigned” transactions to spend it. You need to have your cold wallet validate the transaction to actually process it. That means passing the transaction to the wallet to sign it and then send it back to the blockchain. To get it to the blockchain you need an account somewhere, which is tied to you. They may not know what you have, but they know that you transacted. Should they come knocking, all of the onus is on you to prove what your sell price and average cost basis is.
Track every purchase of crypto in excel or something and keep a rolling average cost to reference, should it be required for tax purposes.
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