Crypto tax in Canada: half of gains taxed, or all as business income

Which crypto transactions does the CRA tax?

A disposition happens when your client trades crypto for dollars or for another crypto, uses it to pay for goods or services, or gives it away as a gift or donation, and the CRA says that list isn't exhaustive canada.ca. Moving coins between wallets your client owns is not a disposition.

Every value is in Canadian dollars at the time of the transaction. The CRA generally accepts fair market value, wants a reasonable method used consistently from year to year (for example, the rate from the exchange your client trades on), and expects you to record the method canada.ca.

When is crypto business income instead of a capital gain?

The CRA decides case by case. These are the factors it lists as pointing to business income canada.ca:

A single trade can still be business income if it's an adventure or concern in the nature of trade. The CRA points to paragraphs 9 to 13 of IT-479R as relevant, while noting crypto isn't necessarily a security for tax purposes canada.ca.

The difference is large. Business income is fully taxable. On capital account, half the gain is taxable and half a loss is allowable canada.ca. The proposed increase to two thirds was cancelled on March 21, 2025, so the 50% rate carries into 2026 pm.gc.ca. See /tax/capital-gains-inclusion-rate-2026/ for the full history.

Allowable capital losses only offset taxable capital gains, not employment or other income. Any excess becomes a net capital loss that can go back three years or forward indefinitely against taxable capital gains canada.ca.

How do averaging, a swap and a superficial loss set one client's ACB?

Units of one crypto are the same as each other, so the identical property rule applies: the ACB is the average cost of the pool, recalculated at each purchase, and a sale doesn't change the per unit cost canada.ca. Here's one client's year on capital account.

The ETH starts with an ACB of $45,000, its value in dollars on the day of the swap. The client reports $10,000 of taxable capital gain on line 12700 for the year, and the $5,000 loss waits inside the BTC ACB until the pool is sold.

The superficial loss rule in section 54 of the Income Tax Act catches a loss when your client, or a person affiliated with your client, acquires the same or identical property in the window from 30 days before to 30 days after the sale, and owns it at the end of that window laws-lois.justice.gc.ca. Affiliated persons include a spouse or common law partner and a corporation either of them controls, so a repurchase in the spouse's exchange account still triggers it canada.ca.

The CRA's own swap example matches this method: a client trades crypto B that cost $15,000 for crypto A worth $20,600, for a $5,600 capital gain and a $2,800 taxable capital gain canada.ca.

How are mining and staking taxed?

The CRA says mining is in most cases a business because of its scale and resources, and the coins received must be included in business income at the time they are earned canada.ca. A non resident running mining equipment located in Canada may be carrying on business in Canada and need to file a Canadian return.

Staking rewards on a centralized exchange are generally income when they're credited to your client's platform wallet, usually paid in the same crypto that was staked canada.ca.

For equipment, the CRA considers that ASIC miners and GPU mining rigs can meet the conditions for class 50 canada.ca. Class 50 carries a 55% CCA rate canada.ca.

On the GST/HST side, section 188.2 of the Excise Tax Act, in force since February 5, 2022, generally treats mining as not a commercial activity. The miner doesn't charge GST/HST on mining rewards and generally can't claim input tax credits on mining costs, unless the miner mines for a person whose identity it knows canada.ca.

What has the CRA said about airdrops, hard forks and lost or stolen crypto?

Almost nothing. As of October 2026, the CRA's crypto asset guide and all six of its topic pages (obligations, records, valuation, transactions, mining and staking, GST/HST) don't mention airdrops, hard forks, or crypto that is lost or stolen canada.ca. In that guidance, the CRA has not published a position on how any of the three is taxed, so this page doesn't state one.

The scam line comes from a CRA tax tip on crypto capital gains, published in October 2024 and updated in January 2025, which says a scammed client may be able to claim a loss but gives no rule for the amount, the timing or whether it's a capital loss canada.ca.

Silence isn't a ruling either way: the CRA says its list of dispositions does not include all situations canada.ca. For a client with one of these events, keep what the records page asks for on every transaction (units, date, value in dollars, wallet addresses) canada.ca, and write down how you valued the coins, since the CRA expects a reasonable method used consistently canada.ca.

Which return lines and records does crypto need?

Capital dispositions of crypto go on Schedule 3: total proceeds on line 15200 and the total gain or loss on line 15301 canada.ca. The taxable capital gain then flows to line 12700. Business income from trading, mining or staking goes on Form T2125, the Statement of Business or Professional Activities canada.ca.

A trader on business account computes income through inventory. In the CRA's example, sales of $240,000, opening inventory of $180,000, purchases of $30,000 and closing inventory of $12,000 give a cost of goods sold of $198,000, and after $2,000 of expenses the net business income is $40,000 canada.ca.

Records must be kept for at least six years from the end of the last tax year they relate to canada.ca. For each transaction the CRA wants the units and type of crypto, the date and time, the value in Canadian dollars, a description and the other party (even if only a wallet address), every wallet address used, and the opening and closing balance of each crypto for the year with the cost of the opening balance. Miners also keep hardware receipts, power and pool fee records and pool agreements.

The CRA also tells clients to export their exchange history regularly, in case the exchange stops operating, stops serving Canada or the account is lost canada.ca.