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How do i start a Mining Factory?

Hi everyone,

I'm a newbie in mining bitcoin, so i did some research on YouTube and the forum and i'm very interesting to open a mining factory/Pool with my friend. There were few questions that i concerned.

Do i have to open a company which indicate my business?
If i am just a operator of mining(not buying or selling), do i need to file the taxe to CRA?
What location you can recommend to open a mining pool (avoid noise, more electical power, enough space for more than 500 Miner machines)?
Who should i talk to whether the rental perperty can offer enough electical power? (Hydro Company or the Landlord)?

Thank you guys in advance!

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Comments

  • CoinGuyCoinGuy Administrator
    Disclaimer, I’m not an accountant, so if you are starting a business you should talk to one, but here is the info as I know it.

    1- If you exceed 30k in revenue in one year you need to have a business registered
    2- You still pay taxes if you generate income, it I’ll be the price of Bitcoin th Eritrea you mined
    3- Consider a warehouse — preferably with good security. Keep this location a secret for your safety.
    4- Mining takes a lot of energy and the landlord needs to know you’re not growing pot. the amount of power you’ll use for 500 machines may raise such a flag. You will also want to talk to the power company,

    You will also want to think about insurance and security too.

    Anyway hope this helps get you started. Another option is using an existing mining operation or co-location. Check the threads in the mining section.
  • Hi Administrator! Thank you so much for your advise. I'm more interesting in joining an existing mining operation, that will be more convenience for a beginner, right?
  • CoinGuyCoinGuy Administrator
    Yes this is the best bet....
  • RistRist Member
    edited December 2017
    Carman, I am not an accountant either, but have operated small businesses in the past. If you want to be able to claim anything as a tax deduction, such as space, power, capital equipment, etc., you will need to register as a business (even if only a sole proprietor/self employed). There is no minimum revenue to register a business, but I believe once you exceed $30K, it becomes mandatory. However I might be confusing that with GST registration requirement. Regardless, if you are buying equipment and incur operating costs, it is beneficial to register as a business as soon as possible, to be able to claim deductions.

    If you do not register as a business, any income realised will go on your personal income tax statement and much more difficult to claim deductions. I am sure some may consider not reporting crypto/mining income, however be aware that tax avoidance is legal and tax evasion is not and have heavy consequences.

    If you make more than a few hundred bucks, have a conversation with an accountant. The time you spend with an accountant will pay for itself.

    Note: My numbers are a guideline only and may be out of date or inaccurate for current tax law.
  • Thanks Rist! Your suggestion is really helpful for me, i think i won't start my mining until my concerns being done. As you mentioned a small business exceed 30k in revenue will be required file your tax, how to declare the profit that i make, it depending on how many btc that my business will sell or withdraw as the Canadian currency?
  • Read and think about what he's saying here:

    https://blockoperations.com/planning-your-bitcoin-mining-operation/

    Also, watch his YouTube videos.
  • Wonderful Article! Thank you dubber09, i will carefully read through it today.
  • I do prefer PDU1230 PDUs from same company Rolf is suggesting thou as they are cheaper and have 4 fully separate 12A outlets with individual breakers, and using C20 to C13 cables with those.
    UTT ER840G Load Balance VPN Gigabit Router is a good cheaper alternative, allows for 2 independent ISP connections for redundancy and has VPN capability; you still have 3 LAN ports available to connect switches to them. Switches can be smaller 16-port ones per shelving unit,
    He has a low-med operation going at his larger location thus recommends larger switches.
  • I'm considering start few miners at home first, but my panel is only 100AMP, what do suggest if you extend a sub-panel with 220 volt and separate 5 bakers(15AMP for each) to support 5 antminer S9 ?
  • Do you think i can setup 20 miners in my backyard's shed? I meant without changing a lot of Panel Circuit? And someone mentioned if your electricity growing a lot within a month, police will consider you may growing pot in house. Is that really happened?
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