Donating Or Gifting Crypto In Canada: Tax Rules And Charitable Receipts

I get this question from two kinds of people: parents moving coins to adult kids, and donors who watched a coin double and want the tax win they have heard stock donors get. The first group is usually surprised by a tax bill on a gift. The second is usually surprised that the shortcut does not exist for crypto. Here are the rules from the CRA's own pages.

Is Gifting Crypto Taxable In Canada?

For the person giving it, yes. The CRA lists transferring ownership of a crypto-asset "by way of gift or donation" as a disposition (CRA, reporting income from crypto-asset transactions). Its capital gains guide adds that if you give capital property as a gift, you are considered to have sold it at its fair market value at the time of the gift, and you include any taxable capital gain or allowable capital loss on your return for that year (CRA guide T4037).

There is no gift tax or inheritance tax in Canada on the person receiving a gift. The tax event sits with the giver, and it only produces tax if the coins are worth more than the giver's ACB.

What Does The Person Receiving Crypto As A Gift Pay?

Nothing on receipt. The CRA says if you receive property as a gift, you are generally considered to have acquired it at its fair market value on the date you received it. That becomes the receiver's adjusted cost base, so a later sale is measured from that value. Both sides should write down the date and the CAD value at the time.

How Do Charitable Receipts Work For Crypto?

To claim a federal and provincial donation credit, you need an official donation receipt from a qualified donee such as a registered charity (CRA guide P113, Gifts and Income Tax). The eligible amount of a gift is the fair market value of the property minus any advantage you received. For crypto that means the CAD value on the date of the gift, so keep a screenshot or exchange record of the rate. Not every charity can accept crypto, and a charity that can will usually say how it values the gift. Ask before you send anything.

The CRA says you can generally claim up to 75% of your net income for the year, and you can carry unclaimed gifts forward for five more years. The credit rates are on Schedule 9 for your province, so I do not quote them here. Run the numbers in the calculator or with your preparer before you give a large amount.

Does Donating Crypto Avoid Capital Gains Tax?

No. The CRA's page on gifts of shares and other capital property says you may have an inclusion rate of zero on a capital gain from donating a share, debt obligation or right listed on a designated stock exchange, a mutual fund trust unit, a mutual fund corporation share, ecologically sensitive land and a few other named properties (CRA, gifts of shares and other capital property). Crypto-assets are not on that list. So a gift of crypto produces a normal capital gain on top of a credit on the receipt, and the zero rate you may have heard about for stock donors does not carry over. A spot bitcoin ETF that is listed on a stock exchange is different from bitcoin itself, and whether a particular fund qualifies is a question for the CRA or a professional.

Worked Example: Donating Crypto Versus Donating Cash

Say you bought 0.05 BTC for $2,000 and it is now worth $5,000 when you give it to a charity. You report a capital gain of $3,000 and include half, $1,500, as a taxable capital gain. The charity issues a receipt for $5,000. If you instead sold the coins and donated the $5,000 of cash, the gain is the same $3,000, the credit is the same, and you carry the same record. The difference is not tax; it is whether the charity can accept crypto, and whether you want to avoid exchange fees on the sale. The numbers are illustrative, not prices.

What Records Should You Keep?

Keep the CAD value at the time of the gift, the units, your ACB history, the official receipt, and the charity's name and registration number. The CRA's six-year rule applies to the underlying crypto records (CRA, keeping books and records). Use my ACB guide to work out your cost, and the main crypto tax guide for how capital gains and losses are reported. If you lose money on the coin first, see the superficial loss rule before selling and rebuying.

What About Gifts To A Spouse Or Common-Law Partner?

This is the major exception to the deemed sale at fair market value. The CRA's T4037 guide says you generally do not have a capital gain or loss if you give capital property to your spouse or common-law partner, and that your spouse is considered to have bought the property for the same amount that you are considered to have sold it for. In plain terms, the transfer happens at your adjusted cost base, so no gain is triggered at the time of the gift, and your partner inherits your cost base (CRA guide T4037).

Two catches. First, you can elect in your return not to use that rollover, in which case your proceeds are deemed to equal fair market value and you pay tax on the gain. Second, the CRA says that if your spouse later sells the property during your lifetime, you usually have to report the capital gain or loss from the sale if you are a Canadian resident and still married or living common-law. Moving coins to the lower earner can look like a tax saver, but the attribution rule can pull the gain back to the person who gave the coins. If this is part of a plan, get an accountant to confirm before you move anything.

Worked Example: Gifting Crypto To An Adult Child

Numbers here are illustrative. You bought 0.20 BTC for $8,000 several years ago and it is now worth $20,000 when you give it to your adult child. The gift to a child is not covered by the spousal rollover, so you are treated as selling at $20,000. Your capital gain is $12,000, and you include half, $6,000, in income. Your child is considered to have acquired the coins at $20,000, so if they sell at $20,000 right away they report no gain. The tax cost lands on you, not on them, which surprises many families who thought the recipient would pay.

What If You Sell Crypto To A Relative For Less Than It Is Worth?

The CRA closes that door. Its guide says that if you sell property to someone with whom you do not deal at arm's length and the selling price is less than fair market value, your selling price is considered to be the fair market value. So selling a coin to a family member for $1 does not avoid the gain. The same rule works in reverse for a buyer who pays more than fair market value: their cost is considered to be the fair market value.

How Do You Report A Crypto Gift On Your Return?

The giver reports it on Schedule 3 like any disposition, with the date, the proceeds set at fair market value and the ACB. For a donation, the gift also goes on Schedule 9 with the official receipt amount. If you use software, make sure the gift is entered as a disposition and not as a transfer to your own wallet, because tools often treat unknown outgoing transfers as non-taxable. The step-by-step tax reporting guide shows where each schedule fits, and my TurboTax answer covers the software side.