Australian tax authorities have identified crypto-related gains among several priority areas where further efforts are needed to ensure correct reporting. Authorities remind taxpayers that capital gains or losses from the sale of digital coins and tokens must be calculated and recorded on tax returns.
Australian taxpayers warned that they must report crypto gains
The Australian Taxation Office (ATO) has announced four key areas of focus this year. These include recordkeeping, work-related expenses, rental property income and deductions. Ensuring better oversight on the reporting of capital gains from real estate, stocks, and crypto assets completes the list of priorities, according to the agency.
“The ATO is targeting problem areas where we think people are making mistakes,” Assistant Commissioner Tim Loh was quoted as noting. This senior official stressed that taxpayers should reconsider their claims and comply with applicable rules.
Tax authorities have warned Australians that if they dispose of crypto assets in this fiscal year, including non-fusible tokens (NFTs), they must establish and record capital gains or losses on their tax returns. Loh comments as follows:
Crypto is a popular type of asset and we expect to see more capital gains or losses reported on tax returns this year.
The Assistant Commissioner said that the ATO knows that many Australian residents are buying, selling or exchanging digital assets, so it is important to understand what this means for their tax liability. He also reminded taxpayers that they cannot offset crypto losses against salary or wages.
The agency’s decision to focus on reporting and taxing gains from crypto investments comes after a recent study revealed that more than 1 million Australians, or 5% of those over 18, own one or more cryptocurrencies. According to its authors from market research firm Roy Morgan, young male Australians are the most likely cryptocurrency holders.
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