The Australian Taxation Office is taking measures to monitor crypto transactions and ensure tax law compliance when it comes to digital assets with the help of a new data-matching tool
Crypto monitoring allows the Australian Taxation Office to ensure tax compliance. Image: pixabay
The Australian Taxation Office (ATO) has implemented a new data-matching program in order to monitor crypto transactions through data from banks, financial institutions and crypto asset online exchanges.
The ATO classifies cryptocurrencies as property, thus, digital asset owners are liable for Capital Gains Tax (CGT). Australian investors need to keep details for each crypto asset for tax filing, as they are all separate CGT assets.
To comply with the national tax policy, crypto investors in Australia should keep accurate records of their crypto transactions, including trading dates, the value in Australian dollars at the time of the transaction, the purpose of the transaction, and the details of the receiver/sender, even if it’s just their wallet address.
The new program analyses customers’ individual financial data received from banks, financial institutions and crypto asset online exchanges. The monitoring tool then matches this data to identify individuals transacting in crypto assets. This way, ATO can remind investors of the obligation to include losses and gains stemming from crypto transactions on their tax returns.
The taxpayers who receive a notification about crypto transactions missing on their tax return statements should correct their return. In that case, they won’t receive any penalties. On the other hand, those who will not make amendments may receive further scrutiny and an audit of their affairs. This may eventually delay the processing of their tax returns and any associated refunds.
Besides controlling tax compliance, ATO officials may also use the data obtained through the program to provide some education and support to taxpayers dealing with crypto tax obligations.
The global crypto exchange Binance has recently launched the Binance Tax tool to help users calculate their crypto trading gains.
