You can find this toggle under Settings -> Portfolio & Tax section. Switching this toggle might change the results of your Capital Gains Report. The default setting depends on your tax jurisdiction. The choice of settings may impact your tax liability, so it's essential to consult with your accountant or local tax professionals about your situation before making any changes.
Toggle on
When the toggle is switched on, all your crypto-to-crypto trades are non-taxable. The cost base of the sell side of the asset will be transferred to the buy side of the asset. See the example below:
Date | Category | Sell | Buy | Market value | Cost base | Capital gains |
Jan. 1, 2022 | Buy | - | 1 ETH | $4,000 | $4,000 | - |
Feb. 1, 2022 | Trade | 1 ETH | 10 BNB | $3,000 | $4,000 | - |
Mar. 1, 2022 | Trade | 10 BNB | 3,500 USDT | $3,500 | $4,000 | - |
Apr. 1, 2022 | Sell | 3,500 USDT | - | $3,500 | $4,000 | ($500) |
Note: USDT is cryptocurrency.
Toggle off
When the toggle is switched off, all your crypto-to-crypto trades are treated as taxable disposals and acquisitions. The capital gains/losses are realized in the transaction. See the example below:
Date | Category | Sell | Buy | Market value | Cost base | Capital gains |
Jan. 1, 2022 | Buy | - | 1 ETH | $4,000 | $4,000 | - |
Feb. 1, 2022 | Trade | 1 ETH | 10 BNB | $3,000 | $4,000 | ($1,000) |
Mar. 1, 2022 | Trade | 10 BNB | 3,500 USDT | $3,500 | $3,000 | $500 |
Apr. 1, 2022 | Sell | 3,500 USDT | - | $3,500 | $3,500 | $0 |