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What taxes should be paid in Canada on Bitcoin transactions? Has anyone gotten official advice on this?

Is it relevant whether the Bitcoins were mined, received as payment for services, bought and then sold for a profit, or freely donated?

Is it relevant whether the Bitcoins are exchanged for CAD or exchanged directly for goods?

Is it relevant where geographically the buyer and seller are?

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2 Answers 2

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Taxing authorities consider currencies or goods received in trade to be taxable income. Bitcoin would fall in the same category as foreign currency or barter, and would be taxable.

In Canada, barter is sometimes exempt from taxation:

"According to the Revenue Canada document T-490 (Barter Transactions): if the person(s) bartering is an employee, and not a business owner, they may exchange non-business-related services or goods "occasionally" without being subject to taxation. However, if the goods are business-related, or the exchange is "a regular habit" it falls under the category of taxable income, regardless of his employee status." source

Here's the Revenue Canada bulletin on barter and taxation:

http://www.cra-arc.gc.ca/E/pub/tp/it490/it490-e.txt

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  • So I suppose mining is not taxable, until you sell (or trade) your coins to someone, at which point you'd have to pay income tax.
    – Thilo
    Aug 6, 2012 at 10:02
  • Yes that is correct.
    – Amin
    Dec 12, 2015 at 2:41
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Trading bitcoins for CDN$ is also non taxable if occasional and if your are not doing it as a business..

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  • 2
    Could you please link a source for that information?
    – Murch
    Dec 3, 2013 at 20:27
  • Yes, I doubt this is true at least at the federal level.
    – Kiv
    Dec 5, 2013 at 13:46

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