Year-end balances and how valuation questions arise
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
On a personal return, an unrealised gain on something you merely hold is generally not itself taxable. Even so, pinning down your year-end quantities is essential as a check on whether the gain calculation is right. Valuation rules differ depending on who is holding, so check National Tax Agency guidance and consult a tax professional.
Key points
- For individuals, an unrealised gain on a mere holding is generally not itself taxed
- Nonetheless, fixing your year-end balance is an indispensable check on the calculation
- If the calculated balance does not match what you hold, history is missing
- Companies face a separate period-end valuation question; this reasoning does not transfer
Definition
Establishing the quantities of crypto held at year end and using them to check whether the gain calculation holds together. How valuation itself is treated differs between individuals and companies.
The first thing to be clear about on a personal return: simply holding something that has risen in price — an unrealised gain — is not in itself an immediate taxable event. Under the baseline framework, a gain or loss is realised when a sale, exchange or payment occurs. This is widely misunderstood, so it is worth stating plainly.
That does not make the year-end balance unimportant. It is the single most effective check on the quality of your calculation. Whatever tool or spreadsheet you used produces an implied quantity held at year end. Compare it against the balances actually sitting on exchanges and in wallets.
A mismatch is a signal that the calculation is wrong. Common causes: transactions that failed to import, the same trade counted twice, or a transfer processed as a sale. You cannot eyeball whether a gain figure is correct — but you can compare a quantity against the real thing. That is what makes it a check.
When you check, enumerate every place assets sit: Japanese exchanges, overseas exchanges, self-custody wallets, hardware wallets, and anything still deposited in DeFi pools or staking. Deposited positions tend not to appear in a plain balance view and are the ones people forget. Screenshots or balance exports taken at year end make later verification much easier.
For companies, period-end valuation is a separate question with its own issues. Do not carry this article's reasoning across to a corporate context.
Watch out for
- · This page is a general orientation, not tax advice
- · Do not file on a calculation whose balances do not reconcile — it signals missing history
- · Corporate period-end valuation is a different question; check National Tax Agency guidance and consult a professional
Frequently asked questions
What if my balances are only slightly out?
Even a small discrepancy has a cause — network fees, rounding at small decimal places, or tiny transactions that did not import are typical. Rather than proceeding without identifying it, document what you were able to verify and take it to a tax professional.