[kwlug-disc] Accepting bitcoin (and other cryptos) as a Canadian business

Tue Oct 24 13:40:26 EDT 2017

DVLB in Uptown accepted bitcoin at some point through some service. Not
sure if they still do. You could ask them about their experience.

On Fri, Oct 20, 2017 at 1:41 PM, Chamunks <chamunks at gmail.com> wrote:

> I'll ask my CPA about this at some point and report back whenever I do
> that.
>
> On Fri, Oct 20, 2017 at 12:38 PM Bob Jonkman <bjonkman at sobac.com> wrote:
>
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>> Chamunks wrote:
>> > So @Bob you're saying it's better to just cash out the 13% out of
>> > BTC and bank that for tax day?
>>
>> I don't know if it's "better", but it's certainly more straightforward.
>>
>> Until CRA starts accepting BTC as a payment method it needs to be
>> handled as a foreign currency. And I'm not sure if BTC is recognized
>> as a foreign currency, so then it may need to be dealt with as barter.
>> IANAA, YMMV, ETC.
>>
>> Joel wrote:
>> > Your thinking is on the right track but I wouldn't record it that
>> > way.
>>
>> Thanx Joel! As you point out, there are different ways of recording
>> the transaction, and different payment schedules to CRA. Retaining a
>> tax accountant for a small business is a prudent move.
>>
>> - --Bob.
>>
>>
>> On 2017-10-20 06:31 AM, Joel Nahrgang wrote:
>> >> Not a tax accountant by any means
>> >
>> > I'm not a CPA, but worked in public accounting for over 20 years,
>> > including tax.
>> >
>> > Your thinking is on the right track but I wouldn't record it that
>> > way.
>> >
>> > You make a sale for $100 CDN and charge $13 CDN for hst (13%). You
>> > would owe cra $13 for HST if that is all you did in the filing
>> > period. Regardless of what currency it is in, you just owe $13
>> > CDN.
>> >
>> > If you happen to get paid in bitcoin, using Bob's example and
>> > received 1 BTC, that is what would show on your balance sheet until
>> > the end of the year/quarter/month when you need to adjust all
>> > currencies to reflect the CDN$ value.
>> >
>> > If those currencies are higher than the CDN$ equivalent, then the
>> > difference is recorded as income and can be taxed on it, This would
>> > just go into the overall income and your expenses would reduce the
>> > income.
>> >
>> > On Thu, Oct 19, 2017 at 9:52 PM, Bob Jonkman <bjonkman at sobac.com>
>> > wrote:
>> >
>> > Remi Gauvin wrote:
>> >>>> Not a tax accountant by any means
>> >
>> > Me neither.
>> >
>> >>>> If I traded $100 worth of my service for 1 BTC, then 2
>> >>>> months later,
>> > traded that 1 BTC for $150 cash (or equivalent goods/service), my
>> > total taxable income would be $150
>> >
>> > This needs a tax accountant.  When I generate an invoice for
>> > services rendered I charge HST (13%) at the time of invoicing.  So
>> > if I perform a service for 1 BTC then I would charge 1 BTC + .13
>> > BTC HST = 1.13 BTC.  CRA gets whatever that .13 BTC is worth at the
>> > time the services are billed. The .13 BTC are not mine, and I can't
>> > spend it or invest it.
>> >
>> > If two months down the road my 1 BTC has increased in value 1.5x
>> > then that's a capital gains, just like any other investment. The .5
>> > BTC would be taxed at whatever the capital gains is.
>> >
>> > --Bob.
>> >
>> >
>> >
>> > On 2017-10-19 05:58 PM, Remi Gauvin wrote:
>> >>>> On 17-10-19 04:37 PM, Andrew Stevanus (KWLUG) wrote:
>> >>>>> The recent mention of the Humble Cryptocurrency Bundle and
>> >>>>> the ensuing discussion reminded me of something that I've
>> >>>>> been wondering about for a while. How would one go about
>> >>>>> accepting bitcoin and other cryptocurrencies as a Canadian
>> >>>>> business? Obviously, you'd still have to pay income tax, so
>> >>>>> would you calculate the equivalent amount in CAD when you
>> >>>>> received a payment and just use that? What exchange would
>> >>>>> you get the price from? Does it matter? Do you use the
>> >>>>> price when the invoice is generated, when the customer
>> >>>>> sends the payment, or when it is actually confirmed on the
>> >>>>> blockchain? Are there any additional rules that would apply
>> >>>>> when accepting cryptocurrency versus CAD?
>> >>>>>
>> >>>>
>> >>>> Not a tax accountant by any means, but if you'll allow to
>> >>>> play one for a bit.
>> >>>>
>> >>>> I don't really think it matters a great deal how you convert
>> >>>> value at the time you receive the coins, (so long as it's
>> >>>> consistent and reasonable.  Basically, it would be the same
>> >>>> as barter.).  However, that value would then further be
>> >>>> converted to gain/loss when you dispose of said coins.
>> >>>>
>> >>>> ie.  If I traded $100 worth of my service for 1 BTC, then 2
>> >>>> months later, traded that 1 BTC for $150 cash (or equivalent
>> >>>> goods/service), my total taxable income would be $150.
>> >>>>
>> >>>>
>> >>>>
>> >>>>
>> >>>>
>> >>>> _______________________________________________ kwlug-disc
>> >>>> mailing list kwlug-disc at kwlug.org
>> >>>> http://kwlug.org/mailman/listinfo/kwlug-disc_kwlug.org
>> >>>>
>> >
>> >>
>> >> _______________________________________________ kwlug-disc
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>> >
>> >
>> >
>> > _______________________________________________ kwlug-disc mailing
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>>
>> - --
>> Bob Jonkman <bjonkman at sobac.com>          Phone: +1-519-635-9413
>> <(519)%20635-9413>
>> SOBAC Microcomputer Services             http://sobac.com/sobac/
>> Software   ---   Office & Business Automation   ---   Consulting
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