The Australian tax agency has listed crypto-related profits among several priority areas where more efforts are needed to ensure correct reporting. The authority has reminded taxpayers they need to calculate any capital gain or loss from the sale of digital coins and tokens and record it in their tax returns.
Australian Taxpayers Warned They Should Report Crypto Gains
The Australian Taxation Office (ATO) has announced four key areas where it will focus its attention this year. These include record-keeping, work-related expenses, and rental property income and deductions. Ensuring better scrutiny on the reporting of capital gains from property, shares, and crypto assets completes the list of stated priorities.
“The ATO is targeting problem areas where we see people making mistakes,” Assistant Commissioner Tim Loh has been quoted as noting. The high-ranking official emphasized taxpayers should rethink their claims and abide by applicable rules.
The tax authority is warning Australians that if they dispose of crypto assets this financial year, including non-fungible tokens (NFTs), they will need to establish any capital gain or capital loss and record it in their tax returns. Loh commented:
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Crypto is a popular type of asset and we expect to see more capital gains or capital losses reported in tax returns this year.
The assistant commissioner remarked that the ATO knows that many Australian residents are buying, selling, or exchanging digital assets, so it’s important that people understand what this means for their tax obligations. He also reminded taxpayers they cannot offset crypto losses against their salaries and wages.
The agency’s decision to focus on the reporting and taxation of gains from crypto investments comes after a recent study revealed that more than a million Australians, or 5% of those aged 18 and over, own one or more cryptocurrencies. According to its authors from market research firm Roy Morgan, young male Australians are the most likely cryptocurrency holders.
Do you expect Australia to collect more money in tax revenue from crypto-related capital gains next year? Tell us in the comments section below.