If you are a cryptocurrency investor in Canada, you may wonder what foreign reporting requirements are when it comes to your digital assets. Holding cryptocurrency in a foreign account may also be subject to foreign reporting requirements. Here is a brief overview of what you need to know.
Generally speaking, any time you engage in a cryptocurrency transaction that results in a capital gain or loss, you need to report it on your taxes. This means keeping track of all your cryptocurrency transactions and calculating your gains or losses for each one.
The government wants to make sure that you’re paying your fair share of taxes. That’s why they require Canadian taxpayers who own more than $100,000 worth (in any combination) of foreign property like cryptocurrency or another type listed under “Other specified remittance and investment properties” must file form T1135 with CRA. If there is an event where its value exceeds this amount, failure could result in tax assessment and penalties being issued.