Many business owners and individuals from all industries are becoming involved in cryptocurrency as a second stream of income, or as an investment for future growth. With the amount of confusion around how crypto is taxed it is important you seek professional advice. The ATO has warned that it would write to about 100,000 taxpayers to alert them to their tax obligations amid growing concerns that taxpayers believe their cryptocurrency gains are tax-free or only taxable when their holdings are cashed into Australian dollars.
The term cryptocurrency is generally used to describe a digital asset in which encryption techniques are used to regulate the generation of additional units and verify transactions on the blockchain. Cryptocurrency generally operates independently of a central bank, central authority or government. The creation, trade and use of cryptocurrency is rapidly evolving.
If you are involved in acquiring or disposing of cryptocurrency, you need to be aware of the tax consequences. These vary depending on the nature of your circumstances. Everybody involved in acquiring or disposing of cryptocurrency needs to keep records in relation to their cryptocurrency transactions. One example of cryptocurrency is Bitcoin.
The ATO’s view is that Bitcoin is neither money nor Australian or foreign currency. Rather, it is property and is an asset for capital gains tax (CGT) purposes. Other cryptocurrencies that have the same characteristics as Bitcoin will also be assets for CGT purposes and will be treated similarly for tax purposes.
There are various strategies we can discuss with you regarding ways to protect your investment and minimise tax, and also instances where certain tax payers may not be subject to capital gains tax where the asset is not taxable Australian property.
Send us a message below or contact us to book an appointment. Crypto advisory appointment special $99 incl GST
215 Brisbane Road (Gold Coast Highway), Biggera Waters Queensland 4216, Australia
09:00 am – 05:00 pm
ABN 70 927 551 028
Copyright © 2020 Trades HQ - All Rights Reserved.
Liability limited by a Scheme approved under Professional Standards Legislation.