Does Kraken Report to the CRA?
If you’ve traded on Kraken in Canada, the CRA might already know about it. Learn what Kraken reports to the CRA and what it could mean for your tax obligations.
The CRA actively gathers data from cryptocurrency platforms, including historical trading records obtained through court orders.
Kraken is registered with Canadian regulatory bodies like FINTRAC and must comply with rules that involve collecting user information to combat financial crimes.
Given Kraken’s global presence, it has likely faced demands from the CRA to provide details about Canadian users.
Is Kraken legal in Canada?
Yes, Kraken is legal in Canada.
It operates as Payward Canada Inc., registered with FINTRAC as a Money Services Business, and is also a Restricted Dealer under Canadian securities laws, meaning it must follow compliance requirements, including KYC procedures, AML rules, and report to authorities like the OSC and CSA.
Some features, such as margin trading, derivatives, and some staking services, are restricted for Canadian users due to local regulatory limitations.
Read next: Best Crypto Exchanges Canada
Does Kraken report to the CRA?
Yes. It's likely that Kraken reports to the CRA.
Crypto platforms that are legally active in Canada are required to register with FINTRAC (the Financial Transactions and Reports Analysis Centre of Canada) and implement Know Your Customer (KYC) protocols to verify users' identities.
The data collected through these processes can be passed on to other federal bodies, including the Canada Revenue Agency (CRA). In short, if you’re using a registered exchange like Kraken, there’s a strong chance your account details and transaction history are accessible to Canadian authorities.
What does Kraken report to the CRA?
The CRA has not been fully transparent about the exact information it receives from crypto exchanges like Kraken, but several key details have emerged. The agency has confirmed that it collaborates directly with platforms like Kraken to obtain customer data, which is used to monitor Canadian crypto users and ensure compliance with tax laws. Since January 2022, all money services businesses, including registered crypto exchanges, must report transactions over $10,000 to the CRA. These platforms are also required to verify users’ identities using government-issued ID and proof of address, linking individuals to their exchange activity and making it easier for authorities to trace transactions back to specific taxpayers.
Beyond domestic efforts, the CRA is part of the Joint Chiefs of Global Tax Enforcement (J5), an international alliance that allows for cross-border cooperation and data sharing between tax authorities. This partnership strengthens the CRA’s ability to investigate offshore crypto holdings and global tax evasion. Additionally, the CRA uses sophisticated blockchain analysis tools to trace wallet activity, identify transaction patterns, and potentially connect anonymous wallets to real individuals. Despite the belief that crypto offers full anonymity, the reality is that most blockchain activity is transparent, and the CRA is actively using that to identify underreported or undeclared crypto income.
How do I report my Kraken taxes to the CRA?
If you've made gains, incurred losses, or earned income through Kraken transactions, you're required to report them to the CRA on your annual tax return.
Kraken doesn’t issue official Canadian tax slips, which means it’s up to users to track and calculate their crypto activity. Many Canadian investors turn to crypto tax calculators like Koinly to accurately determine their capital gains, losses, and taxable income from trading or staking.
Read next: Canada Crypto Tax Guide
Report your crypto taxes with Koinly
Koinly simplifies Kraken tax reporting for Canadian users. You can automatically import your Kraken transaction history via SSO or upload CSV files. Koinly also supports over 900 other exchanges, wallets, and blockchains, making it easy to track your entire crypto portfolio in one place.
After importing your data, Koinly calculates your capital gains, losses, income, and other tax-relevant figures. It then generates the necessary reports to help you file accurately with the CRA. Learn more about how to create your Kraken tax forms with Koinly.
FAQs
Do I have to pay tax on my Kraken transactions?
Yes. Any capital gains, losses, or business income from your Kraken activity are taxable in Canada. For more details, see our Canada crypto tax guide.
Do I need to file a Form T1135 for Kraken?
If you held over $100,000 CAD in specified foreign property—which can include crypto assets on foreign exchanges—at any point during the year, you may be required to file Form T1135 with the CRA. Kraken is a U.S.-based exchange, so it could fall under this rule. You should consult a tax professional for advice tailored to your situation.
Is Kraken registered with FINTRAC?
Yes. Kraken, through its Canadian entity Payward Canada Inc., is registered with FINTRAC as a Money Services Business and also operates as a Restricted Dealer under Canadian securities laws.
How do I avoid Kraken taxes in Canada?
You can’t legally avoid paying tax on crypto in Canada, but you can use strategies to lower your taxable amount, like tax-loss harvesting. Platforms such as Koinly provide tools for tax optimization and can help reduce your crypto tax liability within legal limits. See our full guide on minimizing crypto taxes in Canada.
