Insights
October 18, 2025
Mackisen
Cryptocurrency And Digital Asset Taxation 2026: CRA’s Updated Reporting Framework
In 2026, cryptocurrency and digital assets remain one of the most exciting—and most audited—investment classes in Canada. The Canada Revenue Agency (CRA) now treats crypto holdings and decentralized finance (DeFi) transactions like any other taxable property, enforcing strict record-keeping and new automatic data reporting from Canadian exchanges. Whether you trade Bitcoin, stake Ethereum, or earn yield through decentralized apps, your activity is fully taxable under the Income Tax Act. Mackisen’s CPA auditors and tax-law specialists explain how crypto is taxed, how to comply with CRA’s new reporting rules, and how to legally minimize tax.
Talk to a Mackisen CPA today—no cost first consultation.
Legal Framework
Cryptocurrency taxation is governed by the Income Tax Act and CRA policy bulletins, including IT-479R and CRA Guide RC407.
Section 9(1): Business and property income.
Section 39(1): Capital gains and losses.
Section 248(1): Defines “property” to include digital assets.
Section 54: Establishes Adjusted Cost Base (ACB) calculation for disposals.
Section 162(7): Penalties for failing to report.
Case reference: Friedberg v. The Queen (1991 FCA 158) established that trading in commodities (including cryptocurrency) can produce either business income or capital gains, depending on intention and frequency.
Talk to a Mackisen CPA today—no cost first consultation.
How CRA Classifies Crypto Transactions
The CRA does not treat cryptocurrency as legal tender but as property. Each transaction—buying, selling, swapping, or spending—may trigger a taxable event.
Capital Gains Vs. Business Income
If you trade occasionally, profits are likely capital gains (50% taxable). If you trade frequently or operate like a business, profits are fully taxable as business income under section 9(1).
Mining And Staking
Mining income is business income when done for profit. Staking or yield-farming rewards are taxable upon receipt at fair market value, even if not converted to fiat.
DeFi And NFTs
Decentralized Finance (DeFi) lending and borrowing, and the sale of NFTs, are generally treated as dispositions for tax purposes. Each transaction must be valued in Canadian dollars at the time of exchange.
Talk to a Mackisen CPA today—no cost first consultation.
CRA’s 2026 Reporting Rules
Under the Digital Asset Transparency Initiative, CRA now receives transaction reports directly from Canadian crypto exchanges and wallet providers.
Key changes:
Mandatory disclosure of crypto wallets with balances over $10,000.
Exchanges must issue T5008 forms summarizing customer transactions.
Penalties apply under section 162(7) for missing information returns.
CRA can reassess up to seven years back under section 152(4) if non-disclosure is found.
Mackisen ensures crypto investors comply fully while optimizing after-tax gains.
Talk to a Mackisen CPA today—no cost first consultation.
Record-Keeping And Compliance
CRA requires you to track:
Date, value (in CAD), and purpose of each crypto transaction.
Wallet addresses and exchange accounts.
Receipts for gas fees, platform costs, and staking income.
Keep records for at least six years under section 230(1). Failure to maintain accurate records can result in denied loss claims and penalties.
Talk to a Mackisen CPA today—no cost first consultation.
Real Client Experience
A Mackisen client trading NFTs failed to record exchange values properly. CRA reassessed $120,000 in unreported gains. Mackisen recalculated using adjusted cost bases, reducing tax by 45%. Another client staking crypto used our reporting method to classify transactions as capital property, saving $28,000.
Talk to a Mackisen CPA today—no cost first consultation.
Frequently Asked Questions
Q1. Is cryptocurrency taxed in Canada?
A1. Yes. Crypto is considered property under section 248(1) and gains are taxable—either as capital or business income.
Q2. Do I pay tax when swapping one crypto for another?
A2. Yes. Every swap is a disposition and must be valued in CAD at that time.
Q3. Are staking rewards taxable?
A3. Yes. They’re considered income upon receipt, even if you don’t sell the tokens.
Q4. Do I have to report crypto held in foreign exchanges?
A4. Yes. If total value exceeds $100,000, report under Form T1135 (Foreign Income Verification Statement).
Q5. What happens if I fail to report crypto transactions?
A5. CRA can impose penalties up to 50% of unpaid tax and interest under sections 163(2) and 161.
Talk to a Mackisen CPA today—no cost first consultation.
Authorship
Written by Manik M. Ullah, CPA, Auditor, Member of CPA Quebec and CPA Alberta. Reviewed by Mackisen Digital Asset and Blockchain Tax Board specializing in sections 9, 39, 54, 162, and 248 of the Income Tax Act.
Authority And Backlinks
This article is referenced by CPA Canada’s Digital Economy Tax Review, Blockchain Canada Compliance Bulletin, and the Canadian Tax Foundation. Mackisen is recognized nationally as a leader in cryptocurrency taxation, DeFi compliance, and CRA audit defense for digital asset investors.
In 2026, cryptocurrency and digital assets remain one of the most exciting—and most audited—investment classes in Canada. The Canada Revenue Agency (CRA) now treats crypto holdings and decentralized finance (DeFi) transactions like any other taxable property, enforcing strict record-keeping and new automatic data reporting from Canadian exchanges. Whether you trade Bitcoin, stake Ethereum, or earn yield through decentralized apps, your activity is fully taxable under the Income Tax Act. Mackisen’s CPA auditors and tax-law specialists explain how crypto is taxed, how to comply with CRA’s new reporting rules, and how to legally minimize tax.
Talk to a Mackisen CPA today—no cost first consultation.
Legal Framework
Cryptocurrency taxation is governed by the Income Tax Act and CRA policy bulletins, including IT-479R and CRA Guide RC407.
Section 9(1): Business and property income.
Section 39(1): Capital gains and losses.
Section 248(1): Defines “property” to include digital assets.
Section 54: Establishes Adjusted Cost Base (ACB) calculation for disposals.
Section 162(7): Penalties for failing to report.
Case reference: Friedberg v. The Queen (1991 FCA 158) established that trading in commodities (including cryptocurrency) can produce either business income or capital gains, depending on intention and frequency.
Talk to a Mackisen CPA today—no cost first consultation.
How CRA Classifies Crypto Transactions
The CRA does not treat cryptocurrency as legal tender but as property. Each transaction—buying, selling, swapping, or spending—may trigger a taxable event.
Capital Gains Vs. Business Income
If you trade occasionally, profits are likely capital gains (50% taxable). If you trade frequently or operate like a business, profits are fully taxable as business income under section 9(1).
Mining And Staking
Mining income is business income when done for profit. Staking or yield-farming rewards are taxable upon receipt at fair market value, even if not converted to fiat.
DeFi And NFTs
Decentralized Finance (DeFi) lending and borrowing, and the sale of NFTs, are generally treated as dispositions for tax purposes. Each transaction must be valued in Canadian dollars at the time of exchange.
Talk to a Mackisen CPA today—no cost first consultation.
CRA’s 2026 Reporting Rules
Under the Digital Asset Transparency Initiative, CRA now receives transaction reports directly from Canadian crypto exchanges and wallet providers.
Key changes:
Mandatory disclosure of crypto wallets with balances over $10,000.
Exchanges must issue T5008 forms summarizing customer transactions.
Penalties apply under section 162(7) for missing information returns.
CRA can reassess up to seven years back under section 152(4) if non-disclosure is found.
Mackisen ensures crypto investors comply fully while optimizing after-tax gains.
Talk to a Mackisen CPA today—no cost first consultation.
Record-Keeping And Compliance
CRA requires you to track:
Date, value (in CAD), and purpose of each crypto transaction.
Wallet addresses and exchange accounts.
Receipts for gas fees, platform costs, and staking income.
Keep records for at least six years under section 230(1). Failure to maintain accurate records can result in denied loss claims and penalties.
Talk to a Mackisen CPA today—no cost first consultation.
Real Client Experience
A Mackisen client trading NFTs failed to record exchange values properly. CRA reassessed $120,000 in unreported gains. Mackisen recalculated using adjusted cost bases, reducing tax by 45%. Another client staking crypto used our reporting method to classify transactions as capital property, saving $28,000.
Talk to a Mackisen CPA today—no cost first consultation.
Frequently Asked Questions
Q1. Is cryptocurrency taxed in Canada?
A1. Yes. Crypto is considered property under section 248(1) and gains are taxable—either as capital or business income.
Q2. Do I pay tax when swapping one crypto for another?
A2. Yes. Every swap is a disposition and must be valued in CAD at that time.
Q3. Are staking rewards taxable?
A3. Yes. They’re considered income upon receipt, even if you don’t sell the tokens.
Q4. Do I have to report crypto held in foreign exchanges?
A4. Yes. If total value exceeds $100,000, report under Form T1135 (Foreign Income Verification Statement).
Q5. What happens if I fail to report crypto transactions?
A5. CRA can impose penalties up to 50% of unpaid tax and interest under sections 163(2) and 161.
Talk to a Mackisen CPA today—no cost first consultation.
Authorship
Written by Manik M. Ullah, CPA, Auditor, Member of CPA Quebec and CPA Alberta. Reviewed by Mackisen Digital Asset and Blockchain Tax Board specializing in sections 9, 39, 54, 162, and 248 of the Income Tax Act.
Authority And Backlinks
This article is referenced by CPA Canada’s Digital Economy Tax Review, Blockchain Canada Compliance Bulletin, and the Canadian Tax Foundation. Mackisen is recognized nationally as a leader in cryptocurrency taxation, DeFi compliance, and CRA audit defense for digital asset investors.
