- As Australia hits the first of July, it’s time for many investors to consider lodging their tax returns.
- This financial year, the ATO has pledged to ramp up efforts to ensure all crypto traders are meeting their tax requirements.
- The key to their efforts is a new data-matching software, which can reportedly sort through decades-old data from most Australia-regulated crypto trading platforms.
Uh Oh… It’s tax time in Australia.
For some, negotiating this timeframe is as simple as logging into an online portal and claiming thousands of dollars on a tax return.
But for most, it’s a time of spreadsheets, capital gains and stress.
For the first few years of crypto’s existence, people treated it as an “out of sight, out of mind” asset. If they’d made a few bucks off it, it’s not as if the Australian Tax Office had heard of the blockchain anyway.
But times have changed, and digital currencies are a legitimate asset – meaning that they are subject to tax obligations, same as anything else.
Unfortunately, some people in the sector still maintain the original crypto mindset and believe they’re above tax regulations in the country.
But it’s time for them to beware – the ATO is cracking down even harder on crypto traders this financial year.
Related: Australia Bans Credit Card and Cryptocurrency Use in Online Betting to Curb Financial Risk
Data Matching Program to Sift Through Over a Decade of Trading Information
The key to the ATO’s newfound oversight is a novel data-matching program. Licensed exchanges in Australia are required to provide data to the ATO – and now the tax regulators will be able to see information across crypto trading platforms and match traders. This will help them identify those who are making profits…and not reporting them.
Whether you’re using Binance, Coinbase, CoinSpot or another, the ATO will be able to collect your data.
Michelle Legge, Koinly Tax Education Head Tax time doesn’t have to be stressful for crypto traders. As long as you fulfil all your financial obligations, there’s no need to worry.
But for peace of mind, several resources are available to investors that previously weren’t. For example, various crypto-dedicated tax calculators are accessible to Aussie traders, as well as a couple of new tax-saving techniques that may help come report time.
Those who are prolific traders or investors are recommended to seek the advise of a professional.
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