Australian Tax Office asks crypto users to declare profits in annual returns
The Australian Tax Office has warned its public to disclose their profits from cryptocurrency trading in their annual returns, Australian Financial Review reported.
Last month, the ATO published “Tax treatment of cryptocurrencies” to offer clarity to cryptocurrency users on their tax obligations.
The report states, “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.”
For tax purposes, cryptocurrencies are considered as “property” in the country, which means that they are liable for capital gains tax when sold for a profit after July 2017. If a taxpayer holds the cryptocurrency for over 12 months before selling or using it, then he/she may be eligible for a capital gains tax discount of 50 percent.
An ATO spokesperson told AFR that there is an increase in the queries regarding tax obligations of cryptocurrency activity on the ATO’s community channel, which signifies “people wanting to do the right thing in meeting their obligations.”
“While there is no specific label on the capital gains schedule or income tax return to identify how many people have invested in cryptocurrency, we are still determining any significant impact of cryptocurrencies,” the spokesman said.
