On May 27, 2019, the Department
of Finance issued draft legislation and explanatory notes
relating to the Excise Tax Act that would add a "virtual
payment instrument" to the definition of a financial
instrument for GST/HST purposes.
As such, a virtual payment instrument (such as a Bitcoin) would
be treated as a property (and therefore, not money) that would be
considered a financial instrument for GST/HST purposes after May
27, 2019.
Before that date, there was (and still is) uncertainty as to how
to consider Bitcoins and other similar instruments in the context
of purchase and sale transactions. The Canada Revenue Agency (the
"CRA") had previously only provided a limited view
stating that when a GST/HST registrant was accepting
cryptocurrency (including Bitcoins) as mode of payment on the
sale of goods or services, the registrant was to charge GST/HST
calculated on a sale price equal to the fair market value of the
cryptocurrency at the time of the transaction.
