Key takeaways
- Rabby Wallet 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 Rabby’s tax reporting policies within Canada. We’ll also break down a simple way to report your Rabby taxes in minutes.
What is Rabby Wallet?
Rabby Wallet is a self-custodial Web3 wallet with support for Ethereum and EVM-compatible chains. The wallet is popular because of its user-friendly interface and strong security features!Â
As a non-custodial wallet, Rabby does not collect Know Your Customer (KYC) information or issue tax forms. Users are responsible for tracking and reporting taxable income.
Does Rabby Wallet report to the CRA?
While Rabby does not report to the CRA, it’s likely tax authorities can trace your identity.Â
- Blockchain transparency: Remember, transactions on the blockchain are publicly visible. That means if you transfer crypto to/from an exchange with KYC, the CRA can likely identify your wallet. ‍
- CARF in 2027: When the Crypto-Asset Reporting Framework (CARF) comes into effect in 2027, Canadian exchanges will submit detailed customer and transaction information to the CRA. This will give the CRA more visibility into crypto transactions than ever before.
If I use Rabby Wallet in Canada, do I owe taxes?
Yes. Rabby Wallet activity is taxable in Canada:
- Capital gains: Selling or swapping crypto is a disposal subject to capital gains tax. In Canada, 50% of capital gains are included in taxable income.
- Income: Airdrops, staking rewards, and other earnings are taxed as income upon receipt.Â
You do not owe tax when moving crypto between wallets you own.
Does Rabby Wallet have KYC?
No. Rabby does not require ID verification.
Is Rabby Wallet legal in Canada?
Yes. Rabby is legal to use in Canada.Â
You are legally required to report taxable income to the CRA.
How do I avoid Rabby Wallet taxes in Canada?
While you can’t evade your taxes, there are steps you can take to legally reduce your tax bill:Â
- Tax-loss harvesting: Selling crypto at a loss can offset gains and reduce net taxable income. ‍
- Use crypto tax software: Crypto tax software like CoinLedger automatically pulls your Rabby transactions from the blockchain and helps you identify opportunities for tax savings.
Looking for a simple way to report your Rabby taxes? With CoinLedger, you can import your Rabby transactions and auto-generate a complete gains, losses, and income tax report in minutes.
CoinLedger integrates with Rabby 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
Tracking your taxable income from Rabby and other platforms can be difficult. CoinLedger can simplify the process by importing your transactions from hundreds of wallets and exchanges, calculating gains and income, and generating CRA tax reports in minutes.
Get started with a free CoinLedger account today.
