Introduction: Voluntary Disclosure Program Overview The Canada Revenue Agency’s (CRA) Voluntary Disclosure Program (VDP) allows taxpayers to proactively correct previous errors or omissions in their tax filings. This program is beneficial for individuals and businesses seeking to resolve unreported income, incorrect filings, or other discrepancies while avoiding severe penalties and potential criminal prosecution. By participating […]

Introduction: Understanding Bare Trusts in Cryptocurrency Investments The rapid development of blockchain technology has introduced innovative arrangements and opportunities, such as cryptocurrency investments, NFTs, and decentralized finance activities like yield farming. One lesser-known yet impactful tool for Canadian cryptocurrency investors is the bare trust. This article provides an overview of the concept of bare trusts, […]

Introduction – Departure Tax for Canadian Residents Moving Abroad Departure tax is a critical consideration for Canadian residents transitioning to non-resident status. Canadian residents are subject to tax on their worldwide income, while non-residents are only taxed on Canadian-sourced income. The determination of tax residency hinges on various factors and may differ from immigration status. […]

Introduction – Cryptocurrency and NFTs as Matrimonial Property Divorces often result in significant financial changes, with the division of matrimonial property being a central concern. As investments in cryptocurrency and non-fungible tokens (NFTs) continue to grow, these digital assets have increasingly become part of the property division process. This article explores how cryptocurrency and NFTs […]

Introduction – Digital Payment Services and Financial Reporting Obligations Digital payment platforms like PayPal, widely used for personal and professional transactions, have brought convenience to cross-border financial activities. However, they may also bring reporting obligations for Canadian taxpayers. Whether your PayPal account is used for personal or business purposes could affect your obligations to file […]

Introduction – What Exactly is a “DAO”? A Decentralized Autonomous Organization (DAO) is a new-age governance model that leverages blockchain technology and smart contracts to make decisions without centralized leadership. Unlike traditional organizations led by boards or executives, DAOs operate through the collective decision-making of token holders. The voting power of each participant often correlates […]

Introduction – Departure Tax for Canadian Emigrants with Cryptocurrency When a taxpayer ceases to be a Canadian tax resident, paragraph 128.1(4)(b) of Canada’s Income Tax Act deems the taxpayer to have disposed of nearly all property at fair market value. This includes cryptocurrency, non-fungible tokens (NFTs), and other digital assets. The deemed disposition may result […]

The Canada Revenue Agency (CRA) has significantly increased its scrutiny of cryptocurrency-related transactions. As accountants, we recognize that navigating a CRA audit can be both complex and stressful, especially for cryptocurrency investors and traders.  Ensuring compliance and preparing for potential audits is crucial to avoid unexpected tax liabilities, penalties, or reassessments. The CRA’s Growing Focus […]

Introduction – The CRA Releases Tax Tips on Mining Cryptocurrency On March 13, 2023, the Canada Revenue Agency (CRA) issued a media notice offering tax tips about cryptocurrency mining. However, the release provided minimal guidance, leaving many Canadian cryptocurrency miners uncertain about their tax obligations. This article breaks down the differences between cryptocurrency mining, staking, […]