Aussie paid $ 100,000 tax on $ 20,000 cryptocurrency

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A resident of Australia paid a tax on cryptocurrency assets, which is five times higher than their value. About this local edition Micky told the head of Crypto Tax Australia Adrian Forza.

According to Forza, one of his clients had to pay a $ 100,000 tax on coins worth only $ 20,000. This happened because of the rules of the Australian Tax Administration (ATO), which requires the value of assets to be declared at the time of receipt.

Thus, the Australian received payment in cryptocurrency in January 2018, when Bitcoin was still near its historical maximum. Then the value of its digital assets was $ 250 thousand, but by the time the bills were received, the bear market had turned them into $ 20 thousand.


“It was a disaster! It's really unfair, because he got a cryptocurrency, its value has decreased significantly and now he has to pay tax on funds that he does not have, ”Forza said.
He also spoke about other features of the Australian taxation of digital currencies.

For example, the tax inspectorate considers Ethereum Classic to be the original chain and is convinced that everyone who owned Ethereum during the fork received them for $ 0. This means that in the case of the sale of Ethereum, they will need to pay capital gains tax in the amount of 100% of the amount received.

“The community is considered the original Ethereum chain, but ATO believes that it was ETC that retained all the original properties,” explains the approach of Forza regulators.
A similar situation exists with other coins resulting from hard forks - for example, Bitcoin Cash or Bitcoin SV.

At the same time, Forza noted that the biggest problem with the taxation of cryptocurrencies is not in the laws themselves, but in their misunderstanding by the holders of cryptocurrencies.
 
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