I’ve been thinking about buying some altcoins however what’s stopped me is that I don’t understand how this works from an accountancy / tax perspective.
Say I purchase 1 BTC, sell this for Ethereum, move ETH to metamask and then buy an ERC20 token, as a random example let’s say LINK through Uniswap.
What details do I need to provide my accountant, so that they can file the tax return based upon the example above ?
Also, how about transaction fees, do these need to be included and filed in the return ?
As far as I know, they are treated fairly similar to fiat currencies with regards to tax declaration. You have to declare the value at the end of the tax year and all mining and staking revenue has to be declared as income. Individual transactions don’t have to be reported. If you’ve made significant gains in a year, the tax authorities may ask you for further documentation.
Another open question for me are wallets: I have very little on Coinbase or similar, mostly in private wallets.
I declare my assets in cryptomonnies including associated revenue.
My cantonal contributions office asked me to provide some proof and I showed the statements from Coinbase or similar but stated that I did not wish to share information about the private wallets. That worked this time, not sure for how much longer that will work.
Keep records of your crypto trades, including dates and amounts. Talk to your accountant about whether you should include transaction fees in your tax calculations.