Canada Crypto Capital Gains Tax 2026 – The New Inclusion Rate Rules
Canada changed its capital gains inclusion rate for gains above $250,000. Here is how it affects crypto investors and what you need to report to the CRA.
Canada's Two-Tier Capital Gains System
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Start for free →Starting June 25, 2024, Canada uses a two-tier inclusion rate for capital gains:
| Annual Capital Gains | Inclusion Rate | Taxable Portion |
|---|---|---|
| First $250,000 | 1/2 (50%) | $125,000 added to income |
| Above $250,000 | 2/3 (66.67%) | $66,667 per additional $100,000 |
For corporations and most trusts: the 2/3 inclusion rate applies to all capital gains, with no $250,000 threshold.
What This Means for Crypto Investors
Example: You sell Bitcoin for a $400,000 gain in 2025.
- First $250,000 × 50% = $125,000 included in income
- Next $150,000 × 66.67% = $100,000 included in income
- Total taxable income addition: $225,000
- At 53.53% top marginal rate (Ontario): tax of ~$120,443
The $250,000 Annual Threshold
The $250,000 threshold applies per year, per individual. It is not cumulative. You cannot defer gains across years to stay under $250,000 for a massive sale – the entire gain is calculated in the year of disposal.
Lifetime Capital Gains Exemption (LCGE)
The LCGE ($1,016,602 in 2024) applies to qualified small business corporation shares and certain farm/fishing property – not to cryptocurrency. Crypto gains are not eligible for the LCGE.
Adjusted Cost Base Reminder
All Canadian crypto capital gains are calculated using the Adjusted Cost Base (pooled average) method. You cannot cherry-pick specific lots. ACB is recalculated every time you buy more of the same crypto.
Reporting to the CRA
- Calculate your ACB for each crypto using full transaction history
- Calculate gain/loss for each disposal
- Identify which gains fall in the 50% vs 2/3 inclusion range
- Report on Schedule 3 with the correct inclusion rates
- Use T1 lines 12700 and 19900 for capital gains summary
Related Resources
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Start for free →Disclaimer: This article is for general informational purposes only and does not constitute tax advice. For individual tax advice, consult a licensed tax professional.