What to expect as a crypto investor going into tax season

As of 2021, 14% of Canadians own or have owned cryptocurrency, according to an online Ipsos poll of more than 2,100 respondents released in October.

TORONTO -- John Sicilia works in the hospitality industry and began investing in cryptocurrencies in the early days of the COVID-19 pandemic. He got involved because he was curious and saw an opportunity.

"People have made quite a bit of money from crypto, so it was interesting for me to see if I could jump in and catch something before it all got too big," he says.

In Canada, the industry is continuing to grow. As of 2021, 14 per cent of Canadians own or have owned cryptocurrency, according to an online Ipsos poll of more than 2,100 respondents released in October. Of those survey participants, 70 per cent hold or held Bitcoin and 41 per cent hold or held Ethereum. In addition, one in four respondents were considering buying digital currencies in the future, according to the poll results, which cannot be assigned a margin of error because it was completed online.

When Sicilia started dabbling in the cryptocurrency space, he was admittedly not thinking about tax implications because of the decentralized nature of digital assets.

But because cryptocurrencies are viewed as property in Canada, investors could owe taxes to the Canada Revenue Agency depending on the situation.

Now that Sicilia has made some money, he is looking to withdraw for the first time and is really starting to think about the tax implications.