Australia’s revamped data program to ‘catch out’ crypto tax cheats

Jesse Coghlan2 hours agoAustralia’s revamped data program to ‘catch out’ crypto tax cheatsThe Australian Tax Office is collecting over a decade of crypto transaction data, and tax dodgers could be busted if they don’t properly file this tax season.666 Total views22 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe Australian Tax Office (ATO) will be closely watching those who cashed in their crypto gains ahead of the country’s financial year ending on June 30, as taxpayers begin lodging their tax returns before the end of the month.

“The ATO has kept a keen eye on crypto in recent years — and this year is no exception,” Adam Saville-Brown, the general manager of crypto tax reporting software Koinly told Cointelegraph.

The ATO has revamped its crypto data matching program to collect data from 2014 to 2026 from “any crypto exchange legally operating in Australia,” Koinly’s tax education head Michelle Legge explained.

“Whether you’re using Binance, Coinbase, CoinSpot, or another, the ATO will be able to collect your data,” she added.

The ATO expects the program to gather information, including names, addresses, emails and even social media accounts and IP addresses of 1.2 million crypto investors each year.

Saville-Brown said most crypto punters in Australiaknow their tax reporting duties, but the program “will likely catch out the few remaining investors that fail to comply.”

Those who don’t correctly file could receive a letter from the ATO with a reminder to report their crypto transactions properly, at the very least.Celsius refunds could spark confusion

The ATO’s guidance isn’t clear on how to handle the Bitcoin (BTC) and Ether (ETH) repayments from bankrupt American crypto lender Celsius, and its users “will be left confused by the potential tax implications as a result of their refunds,” Saville-Brown said.

Crypto deposits create a taxable event — which could be a gain for some, depending on how much they purchased it for.

“What remains unclear to investors is how to calculate their gain or loss, and more specifically, what figure to use as their cost basis,” Legge said.

She added the ATO hasn’t issued guidance on whether investors should use normal accounting methods or alternatives, “such as the original cost basis purchase for those specific assets, or whether they should use the value of the assets at a specific point in time — like the day withdrawals were limited or the bankruptcy filing date.”

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Saville-Brown said it’s advisable to speak to an experienced accountant to work out the tax liability, as the refunds could be either taxable gains or losses.Bitcoin ETFs still go on the tax bill

Australia got two spot Bitcoin exchange-traded funds (ETFs) this month, with one that holds Bitcoin directly for the first time — the other launched on the country’s biggest stock exchange, another first.

But old laws still apply to the new products and investors “will pay Capital Gains Tax whenever they sell holdings from a Bitcoin ETF and make a gain,” said Legge.

She added, “while the introduction of Bitcoin ETFs to the Australian stock market is great news for the wider adoption of cryptocurrency, it’ll still result in a tax bill.”

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