Key takeaways
- Magic Eden does not report directly to the Canada Revenue Agency (CRA).
- The CRA can still trace activity through blockchain analytics.
Cryptocurrency exchanges around the world are starting to report more and more information to government agencies. In this guide, we analyze Magic Eden’s tax reporting policies within Canada. We’ll also break down a simple way to report your Magic Eden taxes in minutes.
What is Magic Eden?
Magic Eden is a multi-chain, non-custodial NFT marketplace and aggregator. Today, Magic Eden is one of the most popular choices for trading NFTs.Â
Magic Eden does not collect Know Your Customer (KYC) information or issue tax forms. Users are responsible for calculating and paying their taxes.
Does Magic Eden report to the CRA?
No. Magic Eden does not submit tax data to the CRA.Â
However, it’s important to remember that the CRA can still track the wallet you are using for Magic Eden transactions.
Remember, NFT and crypto transactions are publicly visible on the blockchain. If you transferred crypto to/from a Canadian-registered exchange with KYC, it’s likely your transactions can be linked back to you.
If I use Magic Eden in Canada, do I owe taxes?
Yes. NFTs are subject to tax in Canada:Â
- Capital gains: Selling or swapping NFTs is a disposal. In Canada, 50 percent of net capital gains are included in income.
- Income: Creator royalties, staking rewards, and NFT airdrops are taxed as income upon receipt.Â
Remember, moving NFTs or crypto between your own wallets is not taxable.
Does Magic Eden have KYC?
Magic Eden does not require KYC.
Is Magic Eden legal in Canada?
Yes. Magic Eden is legal to use.Â
You are required to report your taxable income from NFTs and cryptocurrency.
How do I reduce my Magic Eden taxes in Canada?
While you can’t evade your taxes, you can still take steps to legally reduce your tax bill in Canada:Â
- Realize losses: In Canada, losses from cryptocurrency and NFTs can offset your capital gains. Some investors choose to intentionally take losses to reduce their tax bill. ‍
- Crypto tax software: Crypto tax software like CoinLedger can help you save time and effort on reporting your taxes, and help you find opportunities for tax savings.
Looking for a simple way to report your Magic Eden taxes? With CoinLedger, you can import your Magic Eden transactions and auto-generate a complete gains, losses, and income tax report in minutes.
CoinLedger integrates with Magic Eden and dozens of other wallets, blockchains, and cryptocurrency exchanges to automate the entire crypto tax reporting process.
You can get started with a free preview report today.
How CoinLedger can help
Here’s why more than 700,000 investors in Canada and across the world trust CoinLedger.Â
- Import NFT purchases and sales across hundreds of cryptocurrency platforms
- Track gains and income automatically
- Generate tax reports in minutesÂ
Get started with a free account today.
