Is Koinly Really Safe? The Hidden Risks You Need to Know
Many crypto investors use Koinly to file their taxes, assuming it’s a safe and reliable solution. However, tax software carries serious risks that users often overlook.
In this article, we’ll uncover the hidden dangers of relying on Koinly for crypto tax compliance.
1. What If Koinly Shuts Down? Your Tax Data at Risk
- CRA requires 6 years of tax record retention.
- If Koinly goes out of business, do you still have access to your historical tax data?
- Tax Partners provides long-term record-keeping, ensuring compliance.
2. Koinly Misclassifies Transactions, Leading to Overpaid Taxes
- Crypto transactions are complex—Koinly may misclassify staking rewards, airdrops, and DeFi transactions, resulting in overpaying taxes.
- A professional accountant ensures correct categorization, reducing your tax burden.
3. No Accountability – Who Owns Koinly?
- Many crypto tax software companies are faceless organizations.
- If there’s an issue, who do you contact?
- Tax Partners has been in business since 1981, with offices and real accountants ready to assist.
4. No Audit Protection – You’re on Your Own
- If the CRA audits you, Koinly will not defend your tax filings.
- Tax Partners provides full audit representation, ensuring compliance.
5. Software Bugs and Security Issues
- Koinly has experienced bugs in transaction imports, leading to incorrect tax calculations.
- Data breaches are always a concern with third-party software.
- A professional accountant ensures your financial data remains secure.
Conclusion
Koinly might seem convenient, but the risks of miscalculations, security vulnerabilities, lack of support, and data loss make it a dangerous choice for crypto investors.
For 100% accuracy, tax compliance, and peace of mind, choose Tax Partners. Book a consultation today!
This article is written for educational purposes.
Should you have any inquiries, please do not hesitate to contact us at (905) 836-8755, via email at [email protected], or by visiting our website at www.taxpartners.ca.
Tax Partners has been operational since 1981 and is recognized as one of the leading tax and accounting firms in North America. Contact us today for a FREE initial consultation appointment.