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Crypto Tax Accountant Canada: Pros and Cons

Whether you’ve just started trading, investing, buying, selling, or hodling crypto in Canada or are a seasoned expert, the connection between taxes and crypto earnings still remains ambiguous. 

Crypto has become a hot topic in recent years, and with good reason. It has the potential to change the world as we know it, and it’s already changed the world of finance. At the same time, crypto has a complex relation to taxes, and not everyone is aware of what to keep in mind when tax season rolls around. 

If you’re wondering if you need a professional to help with your taxes related to crypto, this article can help! Let’s look at some of the pros and cons of crypto tax accountants in Canada and whether you need one to report your Coinberry cryptocurrency investments.

Tax Considerations For Crypto Buyers and Sellers In Canada

The Canadian Revenue Agency (CRA) currently views crypto as a commodity. This means that if you buy or sell crypto, you will have to pay either capital gains or income tax. If you’re a Canadian citizen or permanent resident, you‘ll have to report any gains you make on crypto to the CRA.

Cryptocurrency is a very new and complex area of finance. If you’re a beginner, you should probably seek the help of a professional. While finding a cryptocurrency accountant in Canada can be a bit tricky, it’s not impossible.

Crypto Tax Accountants In Canada

There are advantages and disadvantages to hiring a professional crypto tax accountant in Canada. Here are some of the pros and cons.

Pros

They can provide you with a detailed breakdown of your crypto gains or losses.

Tax accountants who specialize in crypto should be able to help you determine if you have any capital gains or losses to report. They should help you calculate the value of your crypto holdings and advise on how to best report them.

They can help you determine whether you should be paying income tax or capital gains tax on your crypto.

Since crypto is so new, it's not always clear how to pay taxes on its gains. In some cases it will be treated as income, others as an investment. It's important to understand the tax implications of your crypto holdings so you don't get hit with a surprise audit or other unexpected liability.

They can help you figure out the best way to report your crypto gains or losses to the CRA.

If you're not sure whether you should be paying capital gains tax or income tax, or if you're not sure how to report your crypto gains or earnings, then it's important to talk to a tax accountant who can help you figure out the best course of action.

Cons

You may have to pay an extra fee to hire them.

Tax accountants who specialize in crypto are in high demand. If you're looking for one, you may have to pay an extra fee for their expertise.

You may have to wait a little extra time for your tax filing to be completed.

Tax accountants who specialize in a certain area of the law can be booked up very quickly. If you need your tax filing done by a certain date, it's important to book an appointment as early as possible.

It may be difficult to find a qualified crypto tax specialist.

The crypto space is still very new and there aren't too many qualified tax accountants who specialize in it. And unfortunately, there are a lot of scammers and charlatans in the crypto space. If you need a qualified crypto tax specialist, it may take a little extra effort to find one.

How To Look For The Right Crypto Tax Accountant In Canada

Certain things should be taken into consideration when looking for a qualified cryptocurrency accountant in Canada. Firstly, they should be able to explain how cryptocurrencies work and how they’re taxed. They should also be able to explain the different types of crypto assets and their tax implications.

Secondly, they should understand how to calculate your capital gains or losses on your crypto investments and how to best report them on your taxes. They should also understand how to calculate your income tax on your cryptocurrency investments.

Thirdly, they should be able to provide you with a detailed breakdown of your capital gains or losses on your cryptocurrency investments. This will allow you to see exactly how much money you made or lost on each transaction. It will help you determine whether you have any taxable capital gains or losses at all.

When searching online for a crypto tax accountant in Canada, make sure that they have a good reputation and plenty of previous customers. This isn’t always easy to verify in the fog of the internet, but it will at least give you an idea of how good they are and how well they’ll represent you if you hire them.

How Much Is Crypto Taxed In Canada?

Canada taxes crypto in the form of both income and capital gains. If you earn crypto as a wage or salary, then those earnings will be taxed as income. If you gain crypto from buying, selling, trading, or investing in it, then those earnings will be taxed as capital gains.

Specific tax rates depend greatly on where you’re located and what kind of income bracket you fall into. You can figure this information on your own by visiting the CRA’s website, however hiring a professional crypto tax specialist in Canada might save you the risk of being audited or worse.

Conclusion

If you're looking for a qualified crypto tax consultant in Canada, then you should be careful to find somebody who’s truly qualified. They should have a solid reputation and client base. Otherwise, there's a chance that you might incorrectly file your taxes and end up being audited. 

The best way to ensure that your crypto tax accountant is properly credentialed to help Canadian crypto buyers, sellers, traders, and investors is to begin searching for them well before tax season. And if you're lucky enough to find a good one, schedule an appointment with them as soon as you can.