Crypto Realized Gains and Losses

Tax Topics
1

Taxpayer purchased securities in Bitcoin, Ethereum, etc. and disposed of them at a loss in 2022.

From my understanding CRA generally treats cryptocurrency like a commodity for purposes of the Income Tax Act.

I have entered the NAME OF THE FUND, PROCEEDS OF DISPOSITION, AND ADJUSTED COST BASE on Schedule 3 under Publicly traded shares.

Are there any other steps that need to be taken when dealing with Crypto realized losses?

2

Not sure it matters very much but crypto is listed a couple lines lower on Schedule 3.

2 Likes
3

Thanks for pointing this out, @Arliss, as I hadn’t noticed the change. I’ve been recording them under Publicly traded shares in prior years and this year too. I’m guessing I wasn’t the only one recording them here considering CRA changed the labeling on Schedule 3 this year to make it clearly that they belong with the Bonds, debentures, and promissory notes. I’m really not sure why they want them in that category; at least for me, it’s more intuitive to place them with the Publicly trades shares section.

1 Like
4

Thank you @Arliss

I have two quick questions:

  1. I entered the cyrpto-assets in the Bonds, debentures, promissory notes, crypto-assets section. I see a field Name of Issuer.
    I have the 2022 Crypto Realized Gains and Losses document from Wealthsimple Digital Assets Inc. with the three crypto assets listed with ACB and proceeds of dispostion.
    I entered Wealthsimple Digital Assets Inc. as the name of the issuer for all three asset transactions. Is this how you have done it?

  2. Are we able to record fees (if any) from the disposition of the crypto-assets in the Outlays and Expenses column?

5

It doesn’t matter what you record in the “Name of Issuer” column, this is for your use only.

The only fields that get transmitted to the CRA are the Total Proceeds (column 2) and the Gain (column 5).

Legitimate outlays can be claimed. Once again that field itself doesn’t get transmitted but the value from that cell helps calculate the Gain, which is a value the CRA get on an efiled return.

1 Like
6

@Arliss @kozakworld @snoplowguy
Thank you all for your helpful replies. Have a great weekend.

1 Like