Discussion in 'Blockchain & Cryptocurrency Mining' started by whatdoesthisdo, Jan 24, 2018.
Please continue your tax related discussions here thanks.
wonder if this will take off ...
Lol, time will tell.
Well I'll get the ball rolling
Didn't there use to be a law about not having to pay CGT when using the profits to reinvest in another investment? Or was that only for real estate or something? Could that be applied here if it does exist?
To help start, here are a couple of links that have recently been posted in the BTC thread:
Also with the increased scrutiny by the government on cryptocurrency, keeping details about your trades is crucial especially so you can calculate your tax liabilities for the year.
I have been using https://cointracking.info/ for maybe 3-4 weeks, and I would definitely recommend people (especially HODLers) to use it, it's free (up to 200 transactions for the free version), has a mobile app, and it automates a lot of the tasks of calculating your realised benefits, unrealised benefits, cost base, and tax liability.
FYI not affiliated with the ATO or CoinTracking hahah.
So what's the deal if I don't remember how much I bought my BTC for? Or even if I originally bought LTC and converted?
not that i'm aware of, but that doesn't mean there wasn't/isn't some rules like that
it's almost impossible to be 100% across every tax rule there is
if you ended up depositing $100k+ into a bank account, the default position the ATO is likely to take is that the amount is 100% taxable unless you can prove you have cost base (purchase price)
it is not outside the realms of possibility for the ATO to do something similar ....
is there a website with a calculator that has historical coin/currency exchange figures? even better, precised to an exchange, time and date?
Every exchange I've used has historical data available.
i meant a currency/coin rate converter where i can specifiy time and date, and perhaps to a specific exchange.
edit: i could probably use coinmarketcap's graphs. i figured it'd be easier to add the time and date into a calculator, like what you can do on xe.com.
you like pointing your mouse at a date/time and getting the price? every. exchange. ever.
so that, and add a list of prices of all the other coins/currency at that point of time and date. i know i can get these off the exchanges i'm on. what i'm after is an easier way of viewing the info without having to click around.
They all have APIs you can download the data from, then you can stick it in your own spreadsheet/database/shredder and do what you want with it.
For anyone that needs to know the basics of Taxation of Cryptocurrencies.
Just like a theory of unification, a good tax explanation is simple and concise. Here is a flow chart I made for determining the type of taxes owed (subject to Income, Capital Gains Tax or Business Tax)
Its pretty simple. Identify the tax type owed, then calculate the amount of tax owed. If income, tax is by bracket.
If a Capital Gain has been made, take the original token value/quantity (converting the token value to AUD or to BTC for conversion to AUD) to determine a cost basis, for comparison against the token when you realise profit. Deduct Cost Basis = Taxable Profit.
Critically, you need to realise a profit in Australian Dollars to owe Taxes. This does not mean you circumvent taxes by trading from Token A to Token B but passing the taxes forward on your cost basis when you exchange tokens, working towards realising a profit (i.e. the total taxes stack, waiting for you to realise a profit, which you then pay the outstanding taxes on).
Please do not let accountants complicate it. The ATO cannot force you to redeem a token to pay the taxes. What they can do however, is calculate the amount of tax owed and ask for it when you realise profit in Australian Dollars
Just a correction from a member on my FB group. Business and Company are not interchangable. If you are operating a company, 27.5% tax rate applies. Might be an idea to spend the $250 - $500 in paperwork to register a company in order to side step capital gains taxes, or significantly reduce them with a greater range of protections (Available to businesses/companies)
Whats the point of a company structure compared to 50% capital gains discount if you buy and hold for more than a year?
Maximum tax rates of 20-25% CGT discount which sounds less than the company tax rate?
edit, 33% CGT discount?
I would be wary posting Tax/Accounting advice unless your qualified.
Tax rate for individuals is MTR for less than 12 months with a 50% discount if longer than 12 months. No idea where the 33% comes from, this is for Superfunds.
Not all companies are entitled to the 27.5% corporate tax rate especially where you are not an active SBE or deriving passive income.
Having an ABN does not automatically deem you to be running a 'Business' from the ATO perspective.
$10,000 limit is not on profit it is on purchase cost and only if it is deemed to be a personal use asset (very limtted circumstances).
Tax is not just on realised AUD but also on Crypto to crypto.
There is a whole bunch of circumstances to be deemed as a 'Trader' and be taxed on 'Income' account.
This is just on a brief glance of your post and haven't gone through it all.