Until now, Australian crypto traders have successfully avoided the tax authorities. However, more recently, the Australian Taxation Office (ATO) has commissioned software for data matching, which helps to keep track of tax evaders.
ATO has already counted from 500,000 to 1 million owners of crypto assets in Australia. Of particular concern to the government is the movement of cryptocurrency in the shadow economy, the legality of the origin of such funds and undeclared capital gains.
However, with the help of other regulators and international agencies, ATO hopes to identify those who deliberately distort the amount of their taxes.
ATO Deputy Commissioner Will Day explained that his agency “wants to help taxpayers in pointing out the right amount of taxes.”
The ATO recognizes that it has only “limited data” about the investments of its citizens in cryptocurrencies and the incomes of these taxpayers. In addition, for both taxpayers and third parties, the obligation to disclose such information is limited. Thus, it is difficult to say what results the ATO will end up with.
However, it seems that ATO has already begun to receive “acceptable” information from some data providers. In addition, the data comparison project will be continued, and therefore, over time, the results of work in this direction can yield quite satisfactory results.
The ATO also plans to involve in this work “any interested parties” who can provide and clarify relevant information.
Filing of cryptocurrency tax returns for 2019 can reach record highs. Laws allow traders to claim tax deductions for their losses, but many of them are still not aware of this.
Cryptocurrencies in Australia so far have variable success. For example, the well-known exchange Huobi ceased its operations in this country, and Binance, on the contrary, launched a cryptocurrency purchase service at newsstands throughout the country, which also requires compliance with the KYC rules (which may become one of the data sources for ATO).