One of the largest crypto exchanges in the world - Binance helps millions of crypto investors buy, sell and trade crypto every day. Koinly can help you do your Binance taxes safely, quickly, and accurately.
In short - yes. The majority of tax authorities around the world are taking a similar hard stance on crypto tax evasion. They're working with major exchanges operating in their country to share KYC information and ensure taxpayers are paying their fair share. As Binance is the largest crypto exchange worldwide, it is very likely they have been contacted by multiple tax authorities to share customer information.
To include your Binance crypto investment activity in your annual tax return you'll need to calculate and report any income or capital gains - or losses - you made throughout the year.
You can do this in one of two ways. You can either do it yourself, by identifying your taxable transactions, calculating your net capital gain or loss, and the fair market value of any crypto income.
Or, you can use a crypto tax calculator like Koinly. Koinly calculates your income and gains or losses for you and automatically generates your Binance tax report, ready to file with your tax office.
Koinly works by importing your Binance transaction data to analyze what's taxable, and what's not. Let's look at an example - here's some transactions in a Binance account.
You can import your Binance transaction history via API integration or by uploading CSV files of your Binance transaction history. Once you've done this, you'll be able to see your Binance transactions in Koinly - like this.
Koinly lets you manage all your crypto transactions - from Binance and any other exchanges you use - from one single platform, making crypto tax simple. Here's how to connect...
1. The Binance API will only return the most recent 3 months of futures trades. IF you have traded futures and have transactions that are older than 3 months then you need to add those separately using CSV files.
2. The preferred method for Binance is actually CSV. After all historical data has been imported using CSV files, the API can be connected and set to ‘Start syncing from Now’. This will allow the API to sync any future transactions.
3. Convert trades prior to the 1st of January 2021 are not provided by API.
4. Dust conversions more than 1 year old are not provided by the API.
5. Binance API import normally takes around 50 minutes to complete.
6. If you've already used the API method, make sure you delete your existing Binance transactions from Koinly before you upload your CSV file. You can find this option in the troubleshooting Binance page, on the right. It's really important you do this as otherwise you'll end up with duplicated transactions and an inaccurate tax report!
You'll need to start by downloading a CSV file with your full trading history from Binance before you can upload it to Koinly - here's how.
1. If you're using the CSV file upload method make sure to import your deposits, withdrawals and trades for ALL trading years and not just the current year. Binance lets you download a maximum of 1 year transaction history at a time, so you may need to export multiple CSV files to cover your complete Binance trading history. We have a great help article for common issues with Binance CSV full of troubleshooting tips.
2. If you're investing in Binance futures, you might be a little confused about your data import. On the transactions page, select label and then Realized P&L from the drop down menu to filter to only your futures transactions. Koinly imports the actual profit and loss from your futures trades and aggregate your P&L transactions, so you'll only have a few transactions a day as opposed to potentially hundreds.
3. Margin trades & P2P are not included in your transaction history CSV file.
Having issues with your Binance data import? We can help:
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No, Binance doesn't provide a specific Binance tax report - but it is partnered with a variety of excellent crypto tax apps (like Koinly) that can take your Binance transaction report and use it to generate a tax report for Binance.
There's two ways to generate a Binance tax form - manually or using a crypto tax app. The easiest way is to use the Binance tax reporting API and a crypto tax software like Koinly. Or, alternatively you can export Binance transaction history in a CSV and manually calculate your tax obligations.
Binance.com stopped operating in the US due to regulatory issues with the IRS, subsequently launching Binance.us as a solution. Binance US complies with the IRS to share customer information based on the KYC identification and issues 1099 forms.
Technically no, but you can use your Binance account statement which contains your complete transaction history. You can then use this statement to generate a Binance tax statement.
Yes - if you have capital gains or income as a result of your crypto investment activities on Binance, you'll need to report these to your tax office and pay taxes on them or face steep penalties.
No, US users have been blocked from Binance due to US regulations. However, Binance has launched an American version, Binance.US, that US-based users can use. Some products are not offered to US users though.
No binance.us and binance.com are not the same. Binance.us is specifically for US residents and citizens. In order to comply with US regulations, some of the products of the international Binance exchange are not permitted.
Yes - Binance has provided Proof of Reserves via a snapshot, with a Merkle Tree released for Bitcoin, with more tokens and networks to be added over the coming weeks. Binance’s snapshot covers blockchains including BTC, ETH, BSC, BNB & TRX. For more information about what Proof of Reserves are and why it matters - check out our blog post.