Buying and Selling Goods or Services in Exchange for
The CRA stated that the use of Bitcoins to purchase goods or
services would be treated as a form of barter transaction (see, for
example, Interpretation Bulletin IT-490 "Barter
Transactions" (July 5, 1992)). The CRA's view is that
each party to a barter transaction has received something that is
equal to the value of whatever is given up. For Canadian tax
purposes, if a business sells goods or services in exchange for
Bitcoins, that business must report its income from the transaction
in Canadian dollars (i.e., the fair market value of the Bitcoins at
the time of the sale). GST/HST would be applicable on the fair
market value of the Bitcoins that were used to pay for the goods or
Donation of Bitcoins
The CRA stated that, if Bitcoins are transferred to a qualified
donee, the fair market value of the Bitcoins at the time of the
donation must be used in determining the value of the gift for tax
purposes (see also CRA Pamphlet P113 "Gifts and Income
Tax"). The determination of the fair market value is a
question of fact.
Buying and Selling Bitcoins
The CRA stated that the trading or sale of Bitcoins like a
commodity (i.e., speculating on the changes in the value of
Bitcoins) may result in a gain or loss on account of income or
capital. This determination can only be made on a case-by-case
basis and on the specifics facts of each situation (see, for
example, Interpretation Bulletin IT-479R "Transactions
in Securities" (February 29, 1984)). Generally, the income
tax consequences relating to the tax treatment of gains or losses
arising from the purchase and sale of Bitcoins would be the same as
for transactions involving other types of commodities.
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