Are you a Cryptocurrency Trader or Investor? If yes, then you should be aware of the tax laws of your country to understand what kind of crypto activities are taxable and what not?
Now to make it simple for you to recognize the list of taxable crypto activities; we have divided the list of crypto activities into a taxable and non-taxable categories.
Taxable CryptoCurrency Activities:
- Selling Cryptocurrency for Fiat (such as USD, GBP, EUR, etc.)
- Utilizing crypto-related currencies or assets to pay for goods or services
- Exchanging of one cryptocurrency to another
- Receiving cryptocurrency as earnings (it can be either through mining or as payment for services rendered to a third party)
Above-listed activities are considered as taxable in most of countries.
Non-Taxable CryptoCurrency Activities:
- Transferring of cryptocurrency from one wallet or exchange to another
- Buying crypto against fiat currency
- Donating cryptocurrency to a non-taxable charity institution
- Gifting cryptocurrency to a friend or family member.
Now that we’ve discussed the underlying issues related to crypto taxes. Here we’ve compiled a list of the best cryptocurrency tax software in the industry that will assist you in determining your tax liability against crypto activity based on the different demographical parameters.
CrpytoTrader.Tax is considered as the best crypto tax calculation software available in the market. The software has been recognized as a trusted crypto tax software by renowned publishers which include Bloomberg and VentureBeat. That said, the platform provides a seamless user-interface experience to the range of users; right from the beginner to expert.
Prime features of CryptoTrader.Tax include;
- CryptoTrader.Tax is accessible throughout the globe and the best thing about the platform is that; it is compatible with the tax laws of numerous countries.
- The platform has integrated a wide range of cryptocurrencies and crypto-exchanges to its directory so that you don’t need to juggle between sites to look for data.
- It supports numerous file types which include Schedule C, 8938, FBAR, FATCA, and 8949.
- It generates auto-filled tax documents in a matter of seconds.
- It offers quick responsive support.
2. Token Tax
Token Tax is finest and pervasive tax calculation and reporting software for crypto-related activity. Even Forbes thinks the same about Token Tax. The platform offers a user-friendly interface that allows you to determine the tax liability as they’ve integrated thousand of cryptocurrencies to their system.
Prime features of Token Tax include;
- Token Tax is available across the globe and compatible worldwide. That means, your location doesn’t affect the accuracy of calculating taxes and reporting.
- For faster processing, It allows you to import data from your wallet or exchange.
- It also provides support for margin trading from platforms like Bitmex, Poloniex, etc.
- It supports many file types which include Schedule C, 8938, FBAR, FATCA, and 8949.
ZenLedger is another crypto tax software that allows you to calculate taxes without any hassle. The best aspect of ZenLedger is it’s easy to use dashboard that enables even a technically novice individual to use the platform quite effectively.
Prime features of Zenledger include;
- ZenLedger supports numerous crypto exchanges, currencies, and fiat currencies.
- It is equipped with many CPA tools to assist accounting professionals.
- It can generate different tax reports using the input data.
CoinTracker is one of the leading and efficient tax software providers in the market. What makes CoinTracker perfect is its partnership with Coinbase and TurboTax that helps in streamlining the tax reporting process. In addition to this, the software comes with a user-friendly interface which is suitable for beginners.
Prime Features of CoinTracker include;
- It supports margin trading on major crypto exchanges.
- It helps you in integrating your wallet to your exchanges, which gives you excess to tax calculation.
- It comes with reporting tools and profile management section, in a single dashboard
As per our preliminary testing, these are the best in class tax software available in the market. We’ll be updating the article shortly with some other options as we are testing other software.