Given the volatility of Bitcoin, it is essential to maintain accurate records of all the details of your Bitcoin transactions.
By the time you may file your taxes, Bitcoin’s value has already increased.
Capital gains are owed on your BTC only if you sell your BTC and earn a profit.
Because the CRA treats cryptocurrencies just like securities, if you sell your BTC at a loss, this qualifies as a capital loss.
Therefore, it is necessary to demonstrate to the CRA how you use your cryptocurrencies.
Realized gain is when you sell your BTC for more than you paid and earn an income.
To determine the actual income tax rate for the year, you need to include your entire annual income.
That means that if you were to sell your BTC on the same day of the estimate, the value is the price you would be able to get.
Fair market value is not market value, and rather it is an intelligent estimate made by a knowledgeable source.
Therefore, it is best to keep detailed records of how you use and sell your cryptocurrency, as this will determine how they are taxed.
If you buy and sell cryptocurrency regularly, the CRA treats this as a business, just like earning an income as a traditional asset trader.
AMONG OUR MAIN OBJECTIVES IS TO POPULARIZE THE USE OF CRYPTOCURRENCY, EXPLANATION WHAT CRYPTOCURRENCIES ARE AND HOW THEY PLAY THE ROLE OF PAYMENT INSTRUMENT AND MEANS FOR SAFE STORING AND EARNINGS, AS WELL AS PROVIDING THE NECESSARY KNOWLEDGE, EDUCATIONAL ARTICLES, INFORMATION ABOUT UPCOMING EVENTS AND CONFERENCES DEDICATED TO THE DEVELOPMENT OF CRYPTOCURRENCY.