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Cashing out, bank transfer

  • 29-11-2017 7:50pm
    #1
    Registered Users Posts: 6,418 ✭✭✭ correct horse battery staple


    So I want to sell some crypto I bought over last few years, bought on Kraken, want to sell on Kraken. I am quite happy to lock in over 1000% gains and pay tax on it.

    I have the paperwork in order now and have accountant prepare for capital gains paperwork, however I am worried that the bank might raise eyebrows at receiving large deposits (Kraken's bank is in Germany?), last thing I need is to lose my banking where my salary goes.

    Has anyone had trouble cashing out their bonanza with Irish banks? Am I worried needlessly?


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Comments

  • Registered Users Posts: 1,259 alb


    how much are transferring?


  • Registered Users Posts: 6,418 ✭✭✭ correct horse battery staple


    About 60-70eth


  • Registered Users Posts: 1,259 alb


    (edit)


  • Registered Users Posts: 153 ✭✭ crowseye


    Hi would you mind telling us what kind of paperwork you required to file for your capital gains, thanks.


  • Registered Users Posts: 1,678 ✭✭✭ Selik


    crowseye wrote: »
    Hi would you mind telling us what kind of paperwork you required to file for your capital gains, thanks.

    First 1,270 gains are exempt and 33% on the rest. Form 11 is what you need.

    https://www.revenue.ie/en/self-assessment-and-self-employment/documents/form11.pdf


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  • Registered Users Posts: 153 ✭✭ crowseye


    Selik wrote: »
    First 1,270 gains are exempt and 33% on the rest. Form 11 is what you need.

    https://www.revenue.ie/en/self-assessment-and-self-employment/documents/form11.pdf

    Thanks for that, but just wondering did he need an entire list of all his trades and everything he bought and sold or did he just pay the 33 percent on what he is cashing out, I've heard conflicting reports about that.


  • Registered Users Posts: 13,848 ✭✭✭✭ tk123


    I would have thought Form12 as it's 'just' CGT i.e. no income tax concern?


  • Registered Users Posts: 1,678 ✭✭✭ Selik


    crowseye wrote:
    Thanks for that, but just wondering did he need an entire list of all his trades and everything he bought and sold or did he just pay the 33 percent on what he is cashing out, I've heard conflicting reports about that.


    Interesting you ask as I had this exact dilemma myself which I resolved by withdrawing ALL my cash from all exchanges a few days ago. Basically I sold everything. Since 2013 I have a decent record of all deposits so I'm going to pay tax on the difference and then start again over the next few weeks.

    The other way (ie working out all trades etc) would be a nightmare for myself and even my accountant and wouldn't even be as accurate. Obviously to do this you need to sell everything but it's a nice clean way of doing it. I have a record of all trades (dozens across 4-5 platforms/wallets etc) if ever needed although I doubt it.


  • Registered Users Posts: 5,479 ✭✭✭ Chancer3001


    Newbie question

    Say I sell my coins and put 20k into my bank...

    What happens if I say and do nothing ? Do I get a letter from revenue looking for explanation? Do the bank notify me that I should fill.in some form ?


  • Registered Users Posts: 691 ✭✭✭ Uncle Mclovin


    Newbie question

    Say I sell my coins and put 20k into my bank...

    What happens if I say and do nothing ? Do I get a letter from revenue looking for explanation? Do the bank notify me that I should fill.in some form ?

    No the bank don't notify revenue. In theory you could just not pay the CGT and hope you never get caught. If Revenue did ever audit you though you would be looking at 100% penalty plus interest.

    The bank do notify revenue when you have a certain on deposit. A lot more than 20k would be required.

    I imagine down the line they will do a big focus on non declarations for this sort of activity and they'll make a nice sum out of it.


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  • Registered Users Posts: 2,846 ✭✭✭ discombobulate


    No the bank don't notify revenue. In theory you could just not pay the CGT and hope you never get caught. If Revenue did ever audit you though you would be looking at 100% penalty plus interest.

    The bank do notify revenue when you have a certain on deposit. A lot more than 20k would be required.

    I imagine down the line they will do a big focus on non declarations for this sort of activity and they'll make a nice sum out of it.
    I thought the bank had some sort of obligations to notify revenue of amounts over a threshold or something?


  • Registered Users Posts: 27,467 ✭✭✭✭ drunkmonkey


    I thought the bank had some sort of obligations to notify revenue of amounts over a threshold or something?

    They do anything landing in your account over 15k that includes transfers the looks suspicious. Doesn't have to be a lump sum either 15k over a few days would do it if it's out of line with normal account activity.


  • Moderators, Music Moderators Posts: 19,594 Mod ✭✭✭✭ Mr.S


    Newbie question

    Say I sell my coins and put 20k into my bank...

    What happens if I say and do nothing ? Do I get a letter from revenue looking for explanation? Do the bank notify me that I should fill.in some form ?

    You need to self-declare using the above form and pay CGT. Your bank will flag the 20k deposit with Revenue. Nothing will happen straight away and it could be ages before Revenue come knocking, but they will at some point and you need to be able to prove you've paid your tax. No one will say anything to you when you lodge it. 20k isn't a lot of money in the banks eyes, but they'll still flag the transaction as they are obliged to.
    No the bank don't notify revenue. In theory you could just not pay the CGT and hope you never get caught. If Revenue did ever audit you though you would be looking at 100% penalty plus interest.

    The bank do notify revenue when you have a certain on deposit. A lot more than 20k would be required.

    I imagine down the line they will do a big focus on non declarations for this sort of activity and they'll make a nice sum out of it.

    Your bank will notify revenue of large deposits (10k+), or a series of deposits that make up a large amount in a small period. They're not stupid, they don't just ignore everything under a certain amount.

    Speak to an accountant. You'd be crazy to not pay CGT if you are a Irish resident.


  • Registered Users Posts: 6,418 ✭✭✭ correct horse battery staple


    Transfer arrived, no issues. Getting accountant to sort out paperwork for any taxes due, capital gains is steep but 1) I seen insane return on my investment and 2) its less that the 50% i would have had to pay (already having a full time employment) if it was considered as income. Thanks all.


  • Registered Users Posts: 153 ✭✭ crowseye


    Transfer arrived, no issues. Getting accountant to sort out paperwork for any taxes due, capital gains is steep but 1) I seen insane return on my investment and 2) its less that the 50% i would have had to pay (already having a full time employment) if it was considered as income. Thanks all.

    Did you pay the 33 percent capital gains on just what you cashed out, or did you have to pay on everything even if you haven't realised any actual gains (euro/dollar) wise.


  • Registered Users Posts: 6,418 ✭✭✭ correct horse battery staple


    crowseye wrote: »
    Did you pay the 33 percent capital gains on just what you cashed out, or did you have to pay on everything even if you haven't realised any actual gains (euro/dollar) wise.

    Whatever was sold, you need receipts of your original buy order and your closing sell order, from what I understand its calculated on FIFO basis.
    Keep good records of your orders/trades, especially where it says X coin bought/sold for Y€ ...
    I don't know exact details, accountant seems to know (surprisingly) exactly what to do/file and will calculate my bill soon.

    Now if only I had records of my Mt.Gox trades :P from 5-6 years back, managed to find few emails but not much more), but alas they long gone..


  • Registered Users Posts: 1,678 ✭✭✭ Selik


    Whatever was sold, you need receipts of your original buy order and your closing sell order, from what I understand its calculated on FIFO basis. Keep good records of your orders/trades, especially where it says X coin bought/sold for Y€ ... I don't know exact details, accountant seems to know (surprisingly) exactly what to do/file and will calculate my bill soon.

    While FIFO applies to shares and should logically apply to crypto it's simply not always possible in practice when transferring various amounts of various coins to various exchanges. I posted earlier in this thread in more detail about my workaround for this for this year buts it is not ideal and not necessarily something I would like to be doing every year.

    I might have to setup my own spreadsheet for 2018 and be disciplined in updating it after every trade. This is something Ive always done for shares but they are alot more straightforward to calculate gains on. Or I might just start trading on margin to (legally) avoid CGT altogether.


  • Registered Users Posts: 788 ✭✭✭ Shamo


    Selik wrote: »
    While FIFO applies to shares and should logically apply to crypto it's simply not always possible in practice when transferring various amounts of various coins to various exchanges. I posted earlier in this thread in more detail about my workaround for this for this year buts it is not ideal and not necessarily something I would like to be doing every year.

    I might have to setup my own spreadsheet for 2018 and be disciplined in updating it after every trade. This is something Ive always done for shares but they are alot more straightforward to calculate gains on. Or I might just start trading on margin to (legally) avoid CGT altogether.

    You could checkout cointracking.info. It can calculate tax once you have input your trades. You can either use one of the Exchange APIs or manual input. I had to do a mix of manual and API depending on the Exchange to get the balance correct.

    It supports tax reports on FIFO and you just enter the 33% CGT rate. I've used it to fill out my first CG1 report.


  • Registered Users Posts: 153 ✭✭ crowseye


    What about ICOs have any of you tracked those through something like cointracking.info or how do you calculate returns on those?


  • Registered Users Posts: 25,582 ✭✭✭✭ GreeBo


    Whatever was sold, you need receipts of your original buy order and your closing sell order, from what I understand its calculated on FIFO basis.
    Keep good records of your orders/trades, especially where it says X coin bought/sold for Y€ ...
    I don't know exact details, accountant seems to know (surprisingly) exactly what to do/file and will calculate my bill soon.

    Now if only I had records of my Mt.Gox trades :P from 5-6 years back, managed to find few emails but not much more), but alas they long gone..

    How did you transfer your Euro to your MtGox account?
    If you have those records you could potentially use them to offset any profits?

    e.g. if you put 5K into MtGox 6 years ago, you have effectively lost that, and can show the cash leaving your account.
    now if you have another 5K going to say Coinbase, and 20K coming back, thats a 10K profit rather than a 15K profit.

    If it was me I would be paying CGT on the 10K rather than the 15K


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  • Registered Users Posts: 25,582 ✭✭✭✭ GreeBo


    Shamo wrote: »
    You could checkout cointracking.info. It can calculate tax once you have input your trades. You can either use one of the Exchange APIs or manual input. I had to do a mix of manual and API depending on the Exchange to get the balance correct.

    It supports tax reports on FIFO and you just enter the 33% CGT rate. I've used it to fill out my first CG1 report.


    I use cointracking.info but use the export and then manually import the deposits/withdrawals myself (one thing Kraken is good for is including everything in the export)

    I would stay away from using the API's one wrong click and you have exposed your coins to a 3rd party...:eek:


  • Registered Users Posts: 23,457 ✭✭✭✭ lawred2


    Newbie question

    Say I sell my coins and put 20k into my bank...

    What happens if I say and do nothing ? Do I get a letter from revenue looking for explanation? Do the bank notify me that I should fill.in some form ?

    20k won't interest the back too much..

    Fair play to you though


  • Registered Users Posts: 25,582 ✭✭✭✭ GreeBo


    Shamo wrote: »
    You could checkout cointracking.info. It can calculate tax once you have input your trades. You can either use one of the Exchange APIs or manual input. I had to do a mix of manual and API depending on the Exchange to get the balance correct.

    It supports tax reports on FIFO and you just enter the 33% CGT rate. I've used it to fill out my first CG1 report.

    I presume you are only paying CGT on coins that you have cashed into Euro and wont be re-buying again this year?


  • Registered Users Posts: 2,911 ✭✭✭ Bananaleaf


    About 60-70eth

    Apologies if this is being rude, but do you mind making me totally crazy with jealousy altogether :P and telling me how much you initially purchased this for?


  • Registered Users Posts: 788 ✭✭✭ Shamo


    GreeBo wrote: »
    I presume you are only paying CGT on coins that you have cashed into Euro and wont be re-buying again this year?

    Actually calculating tax on any disposal/exchange of a crypto asset be it to euro or another crypto asset. I want to be on the safe side in the event of a future audit if a large sum is withdrawn. This is how cointracking does it by default also.


  • Registered Users Posts: 25,582 ✭✭✭✭ GreeBo


    Shamo wrote: »
    Actually calculating tax on any disposal/exchange of a crypto asset be it to euro or another crypto asset. I want to be on the safe side in the event of a future audit if a large sum is withdrawn. This is how cointracking does it by default also.

    Is it not only calculated on net realized gains rather than potential gains?


  • Registered Users Posts: 788 ✭✭✭ Shamo


    GreeBo wrote: »
    Is it not only calculated on net realized gains rather than potential gains?

    It's always calculated on realised gains. My point is that i'm taking the traditional stock view of realised gain as selling to euro or exchanging for another asset (in this case crypto to crypto). Taxback.com recently did a post on crypto which said the above.

    Revenue might not track everyone down in a few years to go through all your crypto to crypto trades but i'd prefer to have piece of mind :)


  • Registered Users Posts: 25,582 ✭✭✭✭ GreeBo


    Shamo wrote: »
    It's always calculated on realised gains. My point is that i'm taking the traditional stock view of realised gain as selling to euro or exchanging for another asset (in this case crypto to crypto). Taxback.com recently did a post on crypto which said the above.

    Revenue might not track everyone down in a few years to go through all your crypto to crypto trades but i'd prefer to have piece of mind :)

    Yeah, but I guess my point is that are they really realized util you have cashed them into a fiat currency?

    I dont think Revenue recognise cryptos as assets /currency, only the euro you cash them into.
    Also, you havent realized any gains until you cash them into a fiat...have you?


  • Registered Users Posts: 788 ✭✭✭ Shamo


    GreeBo wrote: »
    Yeah, but I guess my point is that are they really realized util you have cashed them into a fiat currency?

    I dont think Revenue recognise cryptos as assets /currency, only the euro you cash them into.
    Also, you havent realized any gains until you cash them into a fiat...have you?

    I’m not a tax advisor but my take on it is yes you have.

    https://www.taxback.com/blog/cracking-the-code-of-irish-cryptocurrency-tax


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  • Registered Users Posts: 57 ✭✭ nsi423


    Great to hear you were able to cash out!
    I've signed up with kraken but the website is really terrible... error pages all the time, even when trying to trade, which is a bit scary. What was your experience with them?


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