The Australia Taxation Office (ATO) said today that crypto capital gains will be prioritized this year, along with three other critical areas of attention, to guarantee proper tax reporting in Australia.
Because crypto assets, including non-fungible tokens (NFTs), are treated as digital properties in the United States, they are susceptible to gains, according to the ATO.
Because many Australians are investing in cryptocurrencies, the tax authorities expects investors to calculate and declare capital gains or losses from the sales of crypto tokens and NFTs on their tax returns this year.
We know that many Australians are purchasing, selling, or trading digital currency and assets because of our data collecting methods, so it’s critical that individuals understand what this implies for their tax duties.” Tim Loh, Assistant Commissioner, stated.
The ATO also cautioned investors to retain records of their transactions for future reference and that losses from crypto investments cannot be offset with salary or pay.
Crypto investors, according to the regulator, are having difficulty completing their tax returns, which is why the tax office has opted to prioritize it this year.
“The ATO is focusing on issue areas where we observe people making errors,” says the spokesperson.
As the popularity of cryptocurrencies grows, governments around the world are considering levying taxes on digital asset earnings.
Germany just joined the increasing list of countries that tax crypto assets. Crypto investors do not have to pay taxes on bitcoin (BTC) and ether (ETH) kept for at least a year, according to the country’s Federal Ministry of Finance. Trading, staking, lending, hardforks, airdrops, and mining are all covered under the new tax standards.
Uzbekistan approved a bill earlier this month exempting all bitcoin mining enterprises from paying taxes. The legislation also declared that mining companies can use the country’s power to mine cryptocurrency legally, however they would have to pay higher rates.