Crypto Taxation in Australia: Tax Enforcement Plans to Tax 1.2 Million Cryptocurrency Accounts

The Australian Taxation Office (ATO) is taking stringent measures to increase oversight of cryptocurrency activities, with a particular focus on approximately 1.2 million accounts, seeking to identify potential tax discrepancies. This initiative comes at a time when the popularity of cryptocurrencies is on the rise, and the ATO is taking a detailed look at personal and transaction data provided by cryptocurrency exchange platforms.

The ATO’s latest campaign aims to identify any exchange of crypto assets for traditional currencies, goods or services that have not been properly declared. The complexity of the cryptocurrency market often leads to a misunderstanding of tax obligations, something the ATO is determined to clarify and regulate.

“Furthermore, the ability to purchase crypto assets using false information may make them attractive to those looking to avoid their tax obligations,” explained the ATO.

In Australia, crypto assets are treated as property for tax purposes, not as foreign currency. This implies that investors must pay taxes on capital gains arising from the sale or trading of digital assets. The ATO’s strengthened approach highlights its commitment to ensuring that all taxable activities are transparent and correctly reported.

Interest in digital assets has grown notably in Australia. A Treasury report revealed that more than 800,000 taxpayers have carried out cryptocurrency transactions over the past three years, highlighting a 63% increase in 2021. Cryptocurrency revenue in the country is estimated to grow at a compound annual rate of 10.15%, reaching approximately US$1.6 billion by 2028, according to data from Statista.

Disclaimer:

The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing or trading cryptocurrencies carries a risk of financial loss.