Canada’s Revenue Agency (CRA) has warned that a significant share of crypto users may be underreporting their tax obligations, as the agency expands its enforcement efforts amid rapid digital-asset adoption.
According to new disclosures from the CRA, roughly 40% of Canadians trading on crypto platforms are either evading taxes or are at high risk of non-compliance. The estimate comes from risk-assessment models and ongoing audits that highlight persistent gaps between taxable crypto activity and what is actually reported on annual filings.
The CRA’s dedicated cryptoasset compliance program, established to address the rising use of decentralized financial tools, currently has 35 auditors working on more than 230 active cases.
Over the past three years, these efforts have resulted in the recovery of approximately CAD $100 million in previously unreported taxes, interest, and penalties. Officials say the number of cases continues to grow as more platforms, wallets, and trading venues enter the Canadian market.
However, the agency notes that its enforcement capabilities remain constrained by legal and data-access limitations. Existing laws, written before the advent of large-scale digital-asset trading, often make it difficult to reliably identify taxpayers involved in crypto transactions, especially those using offshore platforms or self-custody wallets.
The CRA says these gaps prevent auditors from obtaining clear visibility into trading volumes, capital gains, staking income, or other taxable events.
To address these barriers, the agency has sought court-ordered disclosures of user data from several Canadian crypto companies, including Dapper Labs.
Similar to prior “John Doe” requests issued to banks and payment processors, these orders compel platforms to hand over customer information, transaction histories, and account-level details needed to verify tax compliance.
The CRA argues that such measures are essential to ensuring fairness across the tax system and deterring chronic underreporting.
As Canada prepares for potential regulatory and legislative updates to modernize oversight of the digital-asset sector, the CRA says it will continue prioritizing crypto compliance.
The agency expects enforcement actions, audits, and data-request orders to increase as crypto adoption grows and as policymakers push for clearer rules governing the tax treatment of digital assets.