Have you dabbled in Cryptocurrency? Cryptocurrency, such as Bitcoin, is not considered money or foreign currency but in fact is an asset for capital gains tax purposes.
If you have purchased and disposed of any Cryptocurrency, this will need to be declared in your income tax return as a capital event. Appropriate records to keep are all records of transactions relating to the purchase and sale of the currency. It is considered disposal if the following transactions occur:
- Sell or gift Cryptocurrency
- Trade or exchange
- Convert to other currency
- Use Cryptocurrency to purchase goods or services
As the trading of these currencies are increasing, the ATO is monitoring these events and responding to those who are required to comply with these tax obligations at tax time.
If you are a Bitcoin user you can find out more information about it, how the ATO treats Bitcoin and how it can be utilised in your Self Managed Super Fund.
If you have any questions regarding Cryptocurrency and what your activities are, please call Taxwise on (08) 9248 8124 to get some advice.