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

Tue Oct 24 17:43:29 EDT 2017

There are also other technical and practical concerns for accepting
Bitcoin, besides tax implications.

Two are: delayed verification of payment, and high transaction fees.

On 10/24/17, Kyle Spaans <3lucid at gmail.com> wrote:
> Internet rumours that I've heard is that anyone who accepts bitcoin
> payments sees that method bring in about 0% of their sales volume. From a
> generating-some-buzz perspective it may pay off though.
>
> On Tue, 24 Oct 2017 at 10:41 Darcy Casselman <dscassel at gmail.com> wrote:
>
>> 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
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>>>> >>>>
>>>> >
>>>> >>
>>>> >> _______________________________________________ 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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