Coinbase Tax Guide Canada 2025

What is Coinbase?

Coinbase is one of Canada's most popular cryptocurrency exchanges, offering a regulated platform for buying, selling, and storing digital assets. While Coinbase is a US-based company, it serves Canadian users and supports CAD deposits and withdrawals.

Coinbase products available in Canada:

• Coinbase Exchange: Buy, sell, and trade crypto with CAD
• Advanced Trade: Lower-fee professional trading
• Coinbase Earn: Learn about crypto and earn rewards
• Coinbase Staking: Stake ETH, SOL, ADA, and other proof-of-stake coins
• Coinbase Card: Visa debit card with crypto rewards (US only, but Canadians can use Coinbase)
• Convert Feature: Instant crypto-to-crypto swaps

CRA Tax Treatment of Coinbase Transactions

The Canada Revenue Agency (CRA) treats cryptocurrency as a commodity, not currency. This means most Coinbase activities are subject to capital gains tax, while some activities generate business or property income.

Capital Gains vs. Business Income

The CRA distinguishes between:

• Capital gains: Buying/holding crypto as an investment (most Coinbase users)
• Business income: Frequent trading for profit (day traders, professionals)

Key difference: Capital gains are 50% taxable, business income is 100% taxable. The CRA considers factors like frequency of trades, duration of holdings, and your knowledge/expertise.

Taxable Events on Coinbase

Capital Gains Events (Dispositions)

• Selling crypto for CAD: BTC → CAD = disposition subject to capital gains
• Trading crypto-to-crypto: ETH → SOL = disposition of ETH
• Using Convert feature: BTC → USDC = taxable disposition
• Spending crypto: Using crypto for purchases = disposition
• Gifting crypto: May be deemed disposition at FMV

Income Events

• Coinbase Earn rewards: Property income when received
• Staking rewards: Property income at FMV on receipt
• Coinbase Card rewards: Property income (US users only)
• Referral bonuses: Property income
• Airdrops: May be income depending on circumstances

Non-Taxable Events

• Buying crypto with CAD: Acquisition, no tax until disposition
• Transferring between your own wallets: Not a disposition
• HODLing: No tax while holding

Capital Gains Tax on Coinbase

How Capital Gains Work in Canada

When you dispose of cryptocurrency on Coinbase:

1. Calculate proceeds: Amount received (CAD or FMV of crypto received)
2. Calculate ACB: Adjusted Cost Base of disposed crypto
3. Calculate gain/loss: Proceeds - ACB - Expenses = Capital gain/loss
4. Apply inclusion rate: 50% of gain is taxable (for most taxpayers in 2024/25)
5. Add to income: Taxable capital gains added to Line 12700, taxed at marginal rate

Capital Gains Inclusion Rates

2024 onwards: The inclusion rate depends on total capital gains:

• First $250,000 of gains: 50% inclusion rate
• Above $250,000: 66.67% inclusion rate (proposed for 2024+)

Note: For most Coinbase users, the 50% inclusion rate applies.

Adjusted Cost Base (ACB) Method

The CRA requires the ACB method for calculating cost basis:

• All units of identical cryptocurrency are grouped together
• When you buy: Add cost + fees to ACB pool, increase quantity
• When you sell: Calculate ACB per unit = Total ACB ÷ Total quantity
• Cost basis for sale = ACB per unit × Quantity sold

ACB Example

Transactions:

• Jan 1: Buy 1 BTC for $50,000 CAD + $100 fee = $50,100 total
• Feb 1: Buy 1 BTC for $55,000 CAD + $100 fee = $55,100 total
• Mar 1: Sell 1 BTC for $60,000 CAD (fee: $120)

ACB Calculation:

• After Jan 1: ACB pool = $50,100, Quantity = 1 BTC
• After Feb 1: ACB pool = $105,200, Quantity = 2 BTC
• ACB per BTC = $105,200 ÷ 2 = $52,600
• Disposition on Mar 1:
  • Proceeds: $60,000 - $120 = $59,880
  • ACB: $52,600
  • Capital gain: $59,880 - $52,600 = $7,280
  • Taxable capital gain (50%): $3,640
• Remaining pool: $52,600, 1 BTC

Superficial Loss Rule

Similar to the wash sale rule, Canada has a superficial loss rule:

• If you sell at a loss and repurchase the same crypto within 30 days (before or after), you cannot claim the loss
• The denied loss is added to the ACB of the repurchased crypto
• Applies to you, your spouse, or entities you control

Income Tax on Coinbase Rewards

When Coinbase Rewards Are Taxable

The CRA treats crypto rewards as property income when:

• You receive the rewards (not when you sell)
• You have control over the tokens
• The rewards have ascertainable value

Types of Taxable Coinbase Income

1. Coinbase Earn Rewards

• Tax treatment: Property income (Line 13000)
• Valuation: CAD value at time of receipt
• ACB: Income amount becomes ACB for future dispositions

2. Staking Rewards

• Tax treatment: Property income
• Frequency: Each reward receipt is a separate income event
• Example: Stake 10 ETH, receive 0.4 ETH/year @ $3,000 CAD = $1,200 CAD income

3. Referral Bonuses

• Tax treatment: Property income
• Report on Line 13000 (Other Income)

4. Coinbase Card Rewards (US users)

• Tax treatment: Property income
• Note: Coinbase Card not currently available to Canadian residents

Tax Rates on Income

Property income and taxable capital gains are added to your total income and taxed at your marginal tax rate:

Provincial tax rates also apply. Combined federal + provincial rates range from ~20% to 54% depending on province and income.

How to Download Coinbase Transaction History

Method 1: Tax Reports

1. Log in to Coinbase.com
2. Profile → Documents
3. Select Tax Documents
4. Click Generate Report
5. Select calendar year (Jan-Dec)
6. Download CSV

Method 2: Transaction History

1. Coinbase.com → Profile → Statements
2. Generate Statement for custom date range
3. Select CSV format
4. Download and save securely

Method 3: API Integration (Best for Tax Software)

1. Coinbase.com → Settings → API
2. Create API key (read-only permissions)
3. Connect to Canadian crypto tax software like Koinly
4. Automatic transaction sync with ACB calculations

Understanding Coinbase Transaction Types

*Transfers between your own wallets are not taxable. Gifts or payments may be dispositions.

Coinbase-Specific Tax Scenarios

1. Using Coinbase Convert

Scenario: You convert 1 ETH to 1,800 USDC when ETH = $3,500 CAD.

• Original ETH ACB: $2,500 CAD
• Disposition proceeds: $3,500 CAD
• Capital gain: $3,500 - $2,500 = $1,000
• Taxable capital gain (50%): $500
• New USDC ACB: $3,500 CAD

2. Coinbase Staking (ETH)

Scenario: You stake 10 ETH and receive 0.4 ETH in rewards throughout the year.

• Average ETH price when received: $3,000 CAD
• Income: 0.4 × $3,000 = $1,200 CAD
• Report $1,200 on Line 13000 (Other Income)
• Add $1,200 to ETH ACB pool (0.4 ETH added)

3. Multiple Trades Throughout the Year

Activity:

• 50 trades on Coinbase
• 10 different cryptocurrencies
• Net capital gains: $8,000 CAD

Tax calculation:

• Total capital gains: $8,000
• Taxable amount (50%): $4,000
• Added to income, taxed at marginal rate
• If marginal rate is 30%: $4,000 × 30% = $1,200 tax owed

4. Coinbase Earn

Scenario: Complete Coinbase Earn lessons and receive:

• $7 CAD in COMP
• $5 CAD in GRT
• $6 CAD in FORTH

Tax treatment:

• Total income: $18 CAD
• Report on Line 13000
• Each token gets ACB = income amount

How to Report Coinbase Taxes on Your T1

Schedule 3: Capital Gains (or Losses)

Report Coinbase disposals on Schedule 3:

1. Line 13199: Number of dispositions (can summarize if many)
2. Line 13200: Total proceeds of disposition
3. Line 15300: Total ACB (cost base)
4. Line 15400: Total expenses (fees)
5. Line 19700: Total gains (or losses)
6. Line 19900: Taxable capital gains (50% of line 19700)
7. Flows to Line 12700 on T1 (Taxable capital gains)

Line 13000: Other Income

Report Coinbase rewards income:

• Total all Coinbase Earn, staking, and referral income
• Report on Line 13000 (Other Income)
• Description: "Cryptocurrency rewards - Coinbase"

T1135: Foreign Income Verification Statement

If your total foreign property (including crypto on Coinbase) exceeds $100,000 CAD at any time during the year:

• Must file Form T1135
• Report total cost and year-end value of crypto holdings
• Penalty for non-filing: $25/day up to $2,500

Note: Coinbase is a US company, so crypto held on Coinbase is considered foreign property for T1135 purposes.

Using Crypto Tax Software for Coinbase

Why Use Tax Software?

• Automatic ACB calculations: Complex to track manually
• Superficial loss detection: Software identifies and adjusts
• Multiple exchanges: Consolidate Coinbase with other platforms
• CRA-compliant reports: Schedule 3-ready format
• T1135 assistance: Track foreign property threshold

Best Canadian Crypto Tax Software for Coinbase

1. Koinly

• Canada-specific: ACB method, superficial loss rule, CAD pricing
• Coinbase integration: API sync or CSV import
• T1135 support: Tracks foreign property threshold
• Pricing: From $49 USD/year
• Read full Koinly review

2. CoinTracker

• Strengths: Excellent Coinbase integration
• Canada support: ACB method available
• Pricing: From $59 USD/year

3. Adjustable.ca

• Canada-only: Built specifically for CRA compliance
• Free tier: Up to 100 transactions
• Best for: Canadian-only crypto investors

Example Tax Calculations

Example 1: Simple Coinbase User

Activity in 2024:

• January: Buy $10,000 CAD of BTC @ $60,000/BTC (0.1667 BTC) + $100 fee
• June: Sell 0.1667 BTC @ $75,000/BTC for $12,500 CAD (fee: $125)

Capital gains calculation:

• Proceeds: $12,500 - $125 = $12,375
• ACB: $10,000 + $100 = $10,100
• Capital gain: $12,375 - $10,100 = $2,275
• Taxable capital gain (50%): $1,137.50
• Tax owed (30% marginal rate): $1,137.50 × 30% = $341

Example 2: Coinbase Earn + Staking

Activity:

• Coinbase Earn: $75 CAD in various tokens
• ETH staking: 0.4 ETH received @ $3,000 CAD = $1,200
• No disposals (just holding)

Income tax calculation:

• Total crypto income: $75 + $1,200 = $1,275
• Marginal rate: 30%
• Tax owed: $1,275 × 30% = $382.50

Capital gains: None (no disposals)

Example 3: Active Trader

Activity:

• 200 trades on Coinbase throughout 2024
• Total proceeds: $150,000 CAD
• Total ACB: $130,000 CAD
• Total expenses: $2,000 CAD
• Capital gains: $150,000 - $130,000 - $2,000 = $18,000
• Staking income: $1,500

Tax calculation (35% marginal rate):

• Taxable capital gains: $18,000 × 50% = $9,000
• Capital gains tax: $9,000 × 35% = $3,150
• Income tax: $1,500 × 35% = $525
• Total tax: $3,675

Common Mistakes to Avoid

1. Using FIFO instead of ACB: CRA requires ACB method, not FIFO
2. Not reporting Coinbase Earn income: All rewards are taxable
3. Forgetting about superficial loss rule: Can't claim losses if repurchased within 30 days
4. Not tracking fees in ACB: Purchase and sale fees affect ACB
5. Ignoring Convert trades: Conversions are dispositions
6. Not filing T1135: Required if crypto holdings exceed $100,000
7. Treating as currency: Crypto is property, not foreign currency
8. Not keeping records: Must keep for 6 years
9. Reporting gross instead of net: Deduct fees from proceeds
10. Missing staking income: Each reward is taxable when received

Record Keeping Requirements

What to Keep

CRA requires records for 6 years from the end of the tax year:

• All Coinbase transaction history
• ACB calculations for each cryptocurrency
• Cost basis records for all acquisitions
• Records of transfers to/from external wallets
• Wallet addresses and transaction IDs
• Exchange rate conversions (USD to CAD)
• Supporting documents (screenshots, emails)

How to Keep Records

• Crypto tax software: Automatically maintains ACB records
• CSV exports: Download annually and store securely
• Backup: Keep multiple copies (cloud + local)

FAQs

Do I need to report Coinbase if I only bought and held?

No. Buying and holding is not a taxable event. You only need to report when you dispose (sell, trade, spend) or receive income (staking, Coinbase Earn).

What if my Coinbase account is in USD but I'm Canadian?

You must convert all transactions to CAD using the Bank of Canada exchange rate on the transaction date. Crypto tax software does this automatically.

Are Coinbase fees deductible?

Yes:

• Purchase fees: Added to ACB (reduce future gains)
• Sale fees: Deducted from proceeds (reduce gains or increase losses)

How do I calculate ACB manually?

Manual ACB calculation is tedious and error-prone. Use crypto tax software like Koinly which automatically maintains ACB for all your cryptocurrencies.

What about Coinbase Pro / Advanced Trade?

Same tax rules apply. Some tax software requires separate API connection for Coinbase Pro (legacy platform) vs. main Coinbase account.

Do I pay tax twice on staking rewards?

No. You pay:

• Income tax when received (e.g., $1,000 in ETH = $1,000 income)
• Capital gains tax on appreciation when sold (ACB = $1,000)

The ACB prevents double taxation of the original income amount.

What if I transferred crypto from another exchange to Coinbase?

This is not a disposition, but you must track ACB:

• Transfer maintains original ACB
• Manually input ACB in tax software
• Tag as "incoming transfer" to avoid double-counting

Can I offset Coinbase losses against other income?

Capital losses can only offset capital gains (including from stocks, real estate). They cannot offset employment or business income. Unused losses can be carried back 3 years or forward indefinitely.

Is day trading on Coinbase considered business income?

If you trade frequently with the intention of making profit (not investment), the CRA may consider it business income. This means:

• 100% of gains are taxable (not 50%)
• Losses are fully deductible against any income
• May be eligible for business expense deductions

Consult a crypto tax accountant if you're unsure.

Do I need to file T1135 for Coinbase?

Yes, if the total cost of your crypto holdings on Coinbase (and other foreign property) exceeds $100,000 CAD at any time during the year.

Provincial Tax Considerations

Capital gains and income from Coinbase are subject to both federal and provincial tax:

• Federal: 15-33% on taxable income
• Provincial: Varies by province (5-21%)
• Combined top rate: 44.5% (Alberta) to 54.8% (Nova Scotia)

Use your combined marginal rate when estimating taxes on Coinbase income and capital gains.

Tools & Resources

Recommended Crypto Tax Software

• Koinly - Best overall, excellent ACB tracking
• Adjustable.ca - Canada-specific, free tier
• CoinTracker - Great Coinbase integration

CRA Resources

• CRA Guide to Cryptocurrency
• CRA Capital Gains Guide
• T1135 FAQs

Coinbase Resources

• Coinbase Tax Center
• Coinbase Tax Documents

Final Thoughts

Reporting Coinbase transactions to the CRA requires careful ACB tracking, understanding of the 50% capital gains inclusion rate, and proper classification of income vs. capital gains. With the T1135 foreign property reporting requirement, Canadian Coinbase users must be diligent about tracking their holdings.

Key takeaways:

• Use ACB method (not FIFO) for cost basis calculations
• Track all rewards (Coinbase Earn, staking) as income
• Remember superficial loss rule (30-day repurchase restriction)
• File T1135 if holdings exceed $100,000
• Keep records for 6 years
• Use crypto tax software to automate ACB calculations

Most Canadian Coinbase users can manage their taxes using software like Koinly or Adjustable.ca. Those with complex situations (day trading, business income classification) should consult a crypto-specialized accountant to ensure CRA compliance.