GST | Jan 12, 2023

In February 2022, Canada’s Department of Finance released draft GST/HST legislation covering cryptocurrency mining. The proposed rules will effectively treat cryptocurrency mining as an exempt supply

• These proposals have not yet taken effect. According to the Department of Finance, if the legislation is passed, these tax rules will retroactively come into force as of February 5, 2022.

See:  Canadian Bitcoin Mining 2022 Recap and Outlook

• Exemption:  The proposed rules for cryptocurrency mining tax in Canada contain an exception: They don’t apply when a person performs the cryptocurrency-mining activity for another person whose identity is known to the first person and who doesn’t qualify as a “mining group operator,” which basically refers to a coordinator of a mining pool. In these limited circumstances—when someone mines cryptocurrency for a known person who doesn’t coordinate a mining pool— section 188.2 doesn’t apply, and cryptocurrency miner may need to charge GST/HST on that supply of mining services.

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• Source: https://ncfacanada.org/proposed-changes-to-crypto-mining-gst-hst-rules-whats-capture-and-whats-not/