Taxing Virtual Currencies-New KPMG Canada Report | KPMG | CA
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Taxing Virtual Currencies-New KPMG Canada Report

Taxing Virtual Currencies-New KPMG Canada Report

A recent KPMG Canada report covers the complexity involved in taxing virtual currencies.

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"Taxation of Virtual Currencies" is a three-page overview of the emerging financial medium, which can be used to pay for goods or services or held as an investment. While virtual currencies may be used as a medium of exchange in their country of issuance, they do not have legal tender status in any jurisdiction.

This article looks at the issues involved in taxing these currencies in Canada from a legislative standpoint, and covers how the CRA is currently treating digital currencies as a commodity for income tax purposes, for now. The report also touches on how and when the GST/HST rules apply to bitcoins and other digital currencies.

Background
Very generally, virtual currency that has an equivalent value in real currency, or that acts as a substitute for real currency, is referred to as "convertible" virtual currency. Bitcoin is one example of a convertible virtual currency. Bitcoin can be digitally traded between users and can be purchased for, or exchanged into, U.S. dollars, Euros, and other real or virtual currencies.

Currently, Canadian regulatory authorities do not consider digital currency to be money or currency.

This report is available [PDF 598 KB] to read online as a PDF.

 

For more information, contact your KPMG adviser.

 

Information is current to April 17, 2018. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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