Koinly: Report Crypto Taxes In 2023 (35+ Countries) [2023 Review]
Have you heard of Koinly? As I shared recently on the blog, with the COVID-19 crisis (and market crash), I thought it was a good time to revisit not only my strategy as a frequent flyer (points/miles earner) but also my personal finances, including investments and savings.
When the US stock market crashed, I looked into further ways to diversify my investment portfolio, and cryptocurrencies were a good alternative. I had some experience in the past with Bitcoin and Ethereum (back in 2014), but never really got too much into it. One of the moves I made was to sign-up for the Crypto.com Visa Card and wallet, which turned out to be great so far. Here I wrote about how you can get $25 USD for free, and your Spotify Premium reimbursed if you sign up too.
However, one of the uncertainties when investing in crypto is how to keep track of your money (with so many wallets and exchanges out there), as well as how to declare taxes on gains. In Sweden, Skatteverket says you must declare taxes on your cryptocurrencies if you have:
- Sold cryptocurrency
- Exchange a cryptocurrency with one or more other types of cryptocurrencies
- Exchange a cryptocurrency against a FIAT currency, for example, USD
- Paid with cryptocurrency when purchasing an item (for example, a pair of shoes) or a service (for example, a taxi ride)
- Lent cryptocurrency
- Used cryptocurrency for betting
The report should be done in Appendix K4 under Section D, which you submit together with your income tax return.
It is understandable to declare after exchanging a cryptocurrency with one or more other types of cryptocurrencies since you can make a profit from those transactions. On the other hand, it sounds like a pain in the *ss, to keep track of everything in the correct way. I’m not an exchange trader, but believe me, still, it is cumbersome and complex.
How To Report Crypto Taxes in 2023
However, there’s hope at the end of the tunnel. I just found Koinly, which makes everything much easier!
Koinly calculates your cryptocurrency taxes and helps you reduce them for next year. Simple & Reliable. The tool can help you generate your crypto tax reports, no matter where you live. From the US to Scandinavia to Japan and every country in between. No more wasting hours downloading CSV files, formatting data, figuring out market prices, getting the tax calculations right, etc.
In my case, I use both CoinBase (get $10 USD when opening an account with my link) and Crypto.com Wallets, but with so many other exchanges and wallets out there, one of the key requirements for this to work is to be able to integrate with all of them. Luckily Koinly has a very long list of integrations! You can check the full list on their website, but they support all the major sites, including CoinBase and Crypto.com
Let’s have a look at some of the features that they include. It’s quite a long list, here’s a brief overview.
Portfolio Tracking. Easily track your crypto assets & taxes
View your total holdings and portfolio growth over time (across all your wallets and accounts) along with your tax liabilities.
- Actual ROI and invested fiat. See how much you have invested in your coins
- Income overview. Get an overview of your mining, staking, lending, and other crypto income
- Profit/loss & capital gains. Easily see how much you are up or down. View realized and unrealized capital gains
Data Import. All your transactions are in one place
No more going back and forth between different accounts and wallets. Easily sync your data to Koinly and get a complete picture of all your trading activity.
- Automated data import. Connect your accounts via API, add your BTC wallets using x/y/zpub keys and ETH tokens with your public address
- Margin & Futures trading. Traded with margin on BitMEX, Binance, Kraken, or any other of our supported exchanges? No problem.
- Staking, Lending & DeFi. Been using Nexo, Compound, Celcius, etc.? Koinly recognizes and tags all your income
- Smart transfer matching. Koinly uses AI to detect transfers within your own wallets and excludes them from tax reports.
What’s funny is that I’m not sure why they need to use AI to ‘detect transfers within your own wallets’, might be just the hype and that they wanted to use AI for marketing reasons.
Crypto Tax Reports. Reliable cryptocurrency tax reports
Preview your capital gains and taxes for free. Generate tax documents when you are ready.
- Form 8949, Schedule D. If you are filing in the US, Koinly can generate filled-in IRS tax forms for you.
- International tax reports. Koinly supports the USA, Canada, UK, Germany, Sweden, and a number of other countries.
- TurboTax, TaxAct, H&R. Easily export your transactions to other tax software.
Error Reconciliation. Easily find and fix issues with your transactions
Say goodbye to absurd gains and inaccurate tax reports. Koinly is packed with tools to help you find problems with your transactions.
- Double-entry ledger system. Every change in your asset balances is backed by an entry, making it easy to debug issues.
- Missing transactions. Koinly highlights errors due to incorrectly imported or missing transactions that result in your balances going below zero.
- Auto import verification. No more wondering if you are doing it right. Koinly automatically checks your wallets via API to ensure all data has been imported correctly.
- Duplicate handling. Koinly can skip duplicate transactions whether you import via API or CSV files. No need to keep track of what you have already imported and what’s new.
When it comes to pricing, they have a range of four plans (FREE, HODLER, TRADER, and ORACLE). From a free version, all the way up to very hardcore users, the main difference is the number of transactions they support. The main difference between the FREE version and the paid plans is that it doesn’t include the submission/reporting to tax authorities. Still, the free version is quite amazing for getting an overall view of what you’d have to pay and track your assets.
When it comes to the plans, HODLER is more adequate for people doing only a few transactions a year (maybe buying crypto once a month as a saving alternative to passive index funds or stocks) and holding them for a long time. TRADER is more for people who wants to trade more often, playing the “shorting the market” game from time to time.” Finally, ORACLE is for real-day traders that do lots of transactions every day, and they need to be on top of the nitty-gritty details.
Koinly is one of those tools you’ll end up loving. It makes your life so much easier, and it is definitely worth the money. The pricing points are quite affordable, especially for HODLERS like me, who just want to diversify their investment portfolio (long term) by buying a few times a year and holding the cryptocurrencies.
In my mind, paying around 500 SEK a year for something that solves your declaration problems and minimizes the paperwork it is totally worth it, comparing it with the time it would take to do it myself, or with how much an accountant costs. I truly believe in Koinly’s mission.
I’d recommend you try it with the free version to have an overview of its power and how it works inside. You’ll love to have a single source with all your assets, track your progress (profits and losses), and see how your crypto develops over time.