ATAIX Blog, May, 2018
Profits made off of cryptocurrency trading and investing are taxed in most countries around the world. It’s important to be aware of these laws follow them accordingly. Here is a brief rundown on how cryptocurrency trading gains are taxed in the biggest markets around the world
United States: In the US, cryptocurrencies are legally considered to be property, not tender, as per the IRS. When trading crypto, the IRS views it like they view trading stocks.
“General tax principles applicable to property transactions apply to transactions using virtual currency.”
Canada: In Canada, gains from cryptocurrency trading are treated like gains from any investment. It is considered capital gains, and is subject to a 50% tax. Canadian traders can find more information and tips on this helpful article.
European Union: There is no general consensus for taxing cryptocurrency trading in the entirety of the European Union as of now, and each country has an individual approach. However, it seems that Brussels is working on coming to a decision regarding crypto taxing, and traders in the EU should be attentive in the coming months.
That being said, most nations within the EU are treating cryptocurrency gains as capital gains and are taxing them as such. Check the laws for your specific country to make sure you report your gains accordingly. More information can be found at this bitcoin.com article, which goes over how some of the nations within the EU are approaching crypto trading.
Japan: Japan treats gains from stock investments/trading and gains from cryptocurrency investments/trading differently. In Japan, cryptocurrency trading is considered miscellaneous income, and should be filed and reported as such. A progressive tax put on miscellaneous income means in Japan gains from cryptocurrency trading can be taxed anywhere from 5%-45% as per Japan’s National Tax Agency.
We understand that there are various other markets around the world and we have traders outside the four we have listed here. Our goal here was to make sure everyone is aware that cryptocurrency gains are generally taxed and traders should be aware of this in order to report their gains accordingly. Make sure you keep records of all trades and exchanges to be able to do this. For more information on how cryptocurrencies are legislated and taxed around the world, please visit this page, which covers a comprehensive list of countries.