Kyber Tax Reporting
TokenTax imports Kyber data for easy cryptocurrency trade tracking and tax filing.
What is the Kyber Network?
Kyber Network is a Decentralized Finance (DeFi) liquidity provider across many DeFi protocols. The main goal of Kyber is to facilitate swapping ETH20 tokens simply and frictionlessly. Kyber Network Crystal (KNC) is the ERC20 token facilitating activities on the Kyber Network. KNC tokens allow holders to vote on the fees for the network and how they are distributed by staking KNC.
Taxes on your Kyber transactions
Remember that all trades between one crypto and another crypto or from a sale of crypto for fiat currency are taxable events. If your KNC tokens increase or decrease in value from the time you acquire them until the time you dispose of them, you will incur capital gains or losses at the time you trade or sell your KNC tokens.
On Kyber Network, your earnings from staking are provided in ETH, and these earnings are also taxed. However, unlike how your trades are taxed as capital gains, your staking earnings are taxed as income.
For more information on DeFi taxes, you can read our helpful introductory guide and ask us anything on our chat. For a broader crypto tax overview, our crypto tax guide provides further information for a host of countries with established tax regulations for crypto transactions.
How crypto tax software can simplify your Kyber tax filing needs
Given that Kyber Network powers much of the DeFi space, it’s likely that you have interacted with it and held KNC tokens at some point if you are actively trading. Tracking all of your transactions on your own is needlessly tedious and time consuming. By using crypto tax software, you can have all of your transactions seamlessly and automatically added to your centralized tax dashboard for review. The software automatically formats and labels your transactions by type and platform for easy reference.
Once all your data is synced, crypto tax software automatically calculates your tax liability based on the guidance of your national tax authority. You can then export all your transactions in excel, an auto-filled PDF or a TurboTax-friendly TokenTax import file.
With increasing frequency, national tax authorities are investigating crypto transactions and holdings by individuals. It is so important to report and pay your taxes on your crypto to avoid penalties and fees. Ask us for help on our chat function (lower right corner), and we will guide you through the process step by step.
How crypto tax software can help lower your tax bill
There are a few ways crypto tax software can help reduce your taxes. First of all, before the close of your local tax season (often year-end), you should always check your earnings from the year. At this time, you can take advantage of strategically selling off underperforming tax lots, a strategy more commonly called tax loss harvesting. Crypto tax software will automatically calculate this for you.
If you reside in a jurisdiction where your national tax agency allows specific identification accounting, you can reduce your taxes using our proprietary minimization algorithm. Additionally, crypto tax software can easily sort your trades to allow you to identify how best to take advantage of the lower capital gains tax rates on long-term holdings typical in many jurisdictions.