Five things that may prompt a tax audit of your cryptocurrencies

Written by David Coutu

The Canada Revenue Agency recently established a cryptocurrency-focused unit. This team is equipped with technological tools that help in tackling the tax auditing of your transactions. Here are five things that could trigger a tax audit of your cryptocurrencies.

1. Purchasing cryptocurrencies with your credit cards or bank accounts

Using a credit card or a bank account to purchase cryptocurrencies leaves a financial footprint that can draw attention from tax authorities. Major transactions are often scrutinized and financial institutions are required to report certain operations to tax authorities. If you often use your credit cards or bank accounts to buy cryptocurrencies, this could prompt the tax auditing of your cryptocurrencies.

2. Cash deposits in your bank accounts from cryptocurrency trading platforms

The funds that are deposited in your bank account after selling cryptocurrencies may also trigger an alert. If you make substantial profits with your cryptocurrencies and you transfer these gains to your bank account, it could arouse the tax authorities’ curiosity. It is important that you accurately declare all your gains related to cryptocurrencies to avoid issues with tax authorities.

3. Tax authorities have obtained an order requiring your cryptocurrency trading platform to share information about its clients

Cryptocurrency trading platforms are increasingly monitored by tax authorities. If your trading platform has been compelled by a court order to share information regarding its clients with tax authorities, you may be subject to a tax audit.

4. Being tagged on social media as a cryptocurrency holder

As part of the social media boom, personal information has become more accessible than ever. If you publicly identify yourself as a holder of cryptocurrencies on social media, it may draw the attention of tax authorities. Be aware of the information you share online, as it could prompt a tax audit.

5. Depositing more than $10,000 in cryptocurrencies on your Canadian trading platform

High-value deposits on trading platforms may also attract tax authorities’ attention. In Canada, a deposit that exceeds $10,000 in cryptocurrency can incite a tax audit. It is therefore crucial to precisely track every cryptocurrency transaction you make and to declare your gains accurately.


The lawyers at De Grandpré Chait S.E.N.C.R.L. use the best technological tools available to identify the gains that you should have declared.

For any questions about the tax treatment of your transactions or to correct your tax situation for previous years, please contact our taxation team.