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Frequently withdrawing from Coinbase

  • 13-11-2018 11:40pm
    #1
    Registered Users Posts: 6,676 ✭✭✭ wanderer100
    Registered User


    Just wanted some clarification on here on whether there's any risks with withdrawing money from my coinbase account to my bank account frequently (every 2nd day or so). I'm not doing anything wrong or suspicious but I had a similar situation with Paypal where I was withdrawing money too often for their liking that they eventually limited my account. Just want to be safe here with Coinbase and not break any rules or TOS.

    And also what's the story with revenue/taxes in Ireland around this topic. Just want to stay clear from any trouble really


Comments

  • Registered Users Posts: 6,026 ✭✭✭ grindle
    Registered User


    Just wanted some clarification on here on whether there's any risks with withdrawing money from my coinbase account to my bank account frequently (every 2nd day or so). I'm not doing anything wrong or suspicious but I had a similar situation with Paypal where I was withdrawing money too often for their liking that they eventually limited my account. Just want to be safe here with Coinbase and not break any rules or TOS.
    You're more likely to raise flags with your bank who'll be wondering "Where the fπck did he get all this cash from - better flag this as a matter of interest for revenue."
    If Coinbase holds your funds and stops the outflow I'd take it as a sign that somebody above the bank is investigating where your funds have come from.
    And also what's the story with revenue/taxes in Ireland around this topic. Just want to stay clear from any trouble really
    Every time you've sold crypto to crypto or crypto to cash you've solidified either a gain or a loss. You should be keeping track of this and paying taxes if necessary.


  • Registered Users Posts: 6,676 ✭✭✭ wanderer100
    Registered User


    grindle wrote: »
    You're more likely to raise flags with your bank who'll be wondering "Where the fπck did he get all this cash from - better flag this as a matter of interest for revenue."
    If Coinbase holds your funds and stops the outflow I'd take it as a sign that somebody above the bank is investigating where your funds have come from.

    Every time you've sold crypto to crypto or crypto to cash you've solidified either a gain or a loss. You should be keeping track of this and paying taxes if necessary.

    Thanks for the reply. After some research I came upon this article
    https://www.taxback.com/blog/cracking-the-code-of-irish-cryptocurrency-tax

    which states that one should file a CGT Tax return on your crypto investment profit before the 15th December. However it states
    Fortunately, the first €1,270 of your cumulative annual gains (after deducting expenses and losses from other cryptocurrency investments – further details below) are exempt from tax. But, any profit that you make above this figure will be taxed at 33% and you will need to file a tax return each year. There is no way to avoid it!

    So I've only withdrawn a couple hundred euros so far. If I stay below this figure until 15th December 15th, does that mean I don't have to file a tax return for this year. And when I do eventually cross the €1270 figure how soon should i file a return to stay safe?


  • Registered Users Posts: 6,051 ✭✭✭ Truckermal
    Registered User


    Easier to use Revolut or transfer to Revolut so you can withdraw from a ATM..


  • Registered Users Posts: 6,026 ✭✭✭ grindle
    Registered User


    So I've only withdrawn a couple hundred euros so far. If I stay below this figure until 15th December 15th, does that mean I don't have to file a tax return for this year. And when I do eventually cross the €1270 figure how soon should i file a return to stay safe?

    For their own and your own bookkeeping you should file whether it hits the limit of not - less info for you to have to traipse through finding in the future and they'll be proud of your valiant effort. Plus if you record losses at any point you can offset them against gains. It pays to keep on top of bookkeeping. You could have solidified a €100k gain at the start of the year and as the year went on you could have doubled, tripled or quadrupled your stack whilst recording a loss large enough to negate that gain.
    I stop my trades for the most part from December 1st unless something tasty looms.

    When you say you've withdrawn a certain amount and it doesn't hit the limit - is that all the profit you've made?
    E.g. if you've sold 20ETH and made a gain from it (hilariously unlikely in recent times, but I digress!) what you withdraw has little meaning - it's the gain or loss you've solidified that matters.


  • Registered Users Posts: 6,676 ✭✭✭ wanderer100
    Registered User


    grindle wrote: »

    When you say you've withdrawn a certain amount and it doesn't hit the limit - is that all the profit you've made?
    E.g. if you've sold 20ETH and made a gain from it (hilariously unlikely in recent times, but I digress!) what you withdraw has little meaning - it's the gain or loss you've solidified that matters.


    Yes it's all profit. I've been using btc / eth as a payment method for a a small service I run elsewhere on the internet. I'm not doing any trades in the crypto market at the moment. So yes it's all profit that I'm making and that profit is all that I'm withdrawing.


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  • Registered Users Posts: 6,026 ✭✭✭ grindle
    Registered User


    Yes it's all profit. I've been using btc / eth as a payment method for a a small service I run elsewhere on the internet. I'm not doing any trades in the crypto market at the moment. So yes it's all profit that I'm making and that profit is all that I'm withdrawing.

    Easy enough for you to calculate then!

    (Price of crypto disposed - price of crypto when acquired) - 1270) / 3 = Tax owed. Sounds like you're clear either way. If you've received ETH when it was €1k earlier in the year it would be smart to sell and buy back to record the loss but maintain stack if you were thinking of holding it. Miniscule loss of ETH due to spread but huge fiat loss recorded which you can use to write off against the gain made when you got paid the ETH or whatever other coin.


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