Bitcoins to be taxed like shares
BITCOIN and other crypto-currency investors will have to pay capital gains tax on the sale of these assets, according to new guidance by the Australian Taxation Office.
People in possession of bitcoins don’t need to declare it to the tax office but they will get taxed — like shares — when they dispose of it, ATO senior assistant commissioner Michael Hardy said.
“While you’re holding it there is no need to do anything with it,” Mr Hardy said.
Selling shares or real estate would attract capital gains tax under the existing tax
regime.
Consumers can purchase goods or services for personal use of up to $10,000 with no adverse tax implications.
Workers receiving bitcoins as part of their remuneration could be subject to fringe benefit tax.
Businesses have to record the value of bitcoin transactions as a part of their ordinary income. GST on the supply and receipt of bitcoins is also applicable.
Mr Hardy said industry estimates show there are around 1000 companies that accept bitcoins.
The tax office had discussions with industry experts, businesses and other stakeholders for about 12 months on a tax framework for bitcoin use.
Mr Hardy said bitcoins came into existence in 2009 and most people have “tried to make a pretty good effort to get it right before our guidance”.
He said the tax office will not plough resources into “going backwards to check what people have done”.
The ATO doesn’t expect extra taxation revenue from the bitcoin ruling, Mr Hardy said.
Source: theaustralian
