Australian Tax Office (ATO) to Chase down Bitcoin Investors

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An article in the Australian Newspaper today highlighted a push by the ATO to chase down tax through cryptocurrency investors. According to the article, tax-dodging Bitcoin investors will be confronted by the full investigative powers of the tax office, which has revealed it will use anti-money laundering legislation due to come into force next month as the basis for a long awaited blitz on cryptocurrencies. Tax Blitz on Bitcoin Investors

I was made aware of the ATO investigating any cryptocurrency transactions of $10,000 or more by a friend who works in that governmental department. They informed me that the taskforce has been setup to monitor payments to counteract any possible money laundering or terrorist funding opportunities.

According to the current statement from the ATO, Bitcoin is not a personal use asset, therefore, normal Capital Gains Tax rules apply. The ATO will apply a top marginal tax rate of 47% including medicare levy after a 50% discount if the Bitcoin has been held for more than 12 months. If not then the 50% discount will probably not apply and this is the grey area according to tax laws at the moment in Australia.

It will be interesting to see how governments across the globe approach cryptocurrencies in terms of tax laws and how they will be able to track and monitor payments and determine whether a cryptocurrency was an investment or a source of income. STEEM will most likely throw a spanner in the works as it is actually an income producing cryptocurrency, as opposed to a crypto that you might invest in like Bitcoin. Obviously you can invest in STEEM also, but many could claim it as an income stream.