“A simple option, not ideal, is just to have the parent open up an account in the parent’s name,” Mr. Waters says. “In that scenario, of course, everything would be taxed in the parent’s hands.”
“Probably the route that most people would go is an in-trust account or an informal trust,” he says. “Because it lacks the formal documentation to actually create a trust, there’s some question as to … what this is from a legal and, therefore, tax perspective. It’s a bit of a grey area.” “Oftentimes, it makes sense to have, say, a grandparent make a gift and have the child’s parents be the trustee or agent controlling that account. Then, you bypass that,” Mr. Waters says. “But the concern would be if one or both of the parents makes that gift and then they are overseeing that account, you could have this additional attribution rule apply.”
If the taxpayer holds the cryptocurrency for a long period of time, the sale of it is likely to be treated as a capital gain. In contrast, if the taxpayer trades cryptocurrencies actively, the sale of the asset is more likely to be treated as business income, she says. As with other investment accounts, any interest or dividends earned in a cryptocurrency trading account set up for a minor but funded by a gift from parents will be attributed back to the parents.
If you put the money is a tfsa…then there is no problem.