The Australian Tax Office (ATO) requires the following records to be kept in relation to cryptocurrencies.
- the date of the transactions
- the value of the cryptocurrency in Australian dollars at the time of the transaction (which can be taken from a reputable online exchange)
- what the transaction was for and who the other party was (even if it’s just their cryptocurrency address).
The sorts of records you should keep include:
- receipts of purchase or transfer of cryptocurrency
- exchange records
- records of agent, accountant and legal costs
- digital wallet records and keys
- software costs related to managing your tax affairs
According to the ATO their are approximately 190,000 properties available for short term rentals such as Airbnb, using their “data matching” capabilities they shall be querying any understated or omitted income from owners.
Therefore, it is vital that you have up to date and comprehensive record keeping so that all income and deductions can be included and justified in your tax return.
to discuss further make an appointment with us on +613 9846 6542 or email firstname.lastname@example.org
The central premise to be “outside of the central banking monetary system” and the “way of the future”. If you own or are thinking to own cryptocurrencies, you should not be confused with that those that disagree with Bitcoin being money and those people not understanding it. They do, especially the Australian Taxation Office (ATO)
Buying and selling Bitcoin or any other cryptocurrency may attract a capital gain event which is reportable on your tax return.
A capital gain is the difference between the purchase and sale price and a capital gain event with cryptocurrencies can be the following:
- sell or gift cryptocurrency;
- trade or exchange cryptocurrency (including the exchange of different currencies)
- convert cryptocurrency to fiat currency such as AUD
- use cryptocurrency to obtain goods or services (source: NTAA 2018)
However, there are some provisions which may exempt a capital gain event.
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So you have lodged your tax return and expecting a refund, now when do you receive it?
Typically, if you have lodged your return electronically with your account details it should take around 12 business days (so exclude weekends), however it may take longer. Apart from any arrangements you may have with us the ATO gives the following events which may delay the assessment of your tax return:
- The ATO identifies omitted income
- They need to cross-check data with other government agencies, including Centrelink and Child Support
- You have a debt obligation with the ATO
- You are insolvent
- Your tax file number (TFN) has been compromised
- The ATO queries information provided in the return.
Its important that if you think any of the above applies to you, that you ensure you discuss this with us when completing your tax return.
For many this is an incredibly difficult and sometimes embarrassing issue, here is some important information which may help:
From CPA Australia:
The World Health Organisation defines financial abuse of an older person as, “The illegal or improper exploitation or use of funds or other resources of the older person”. The definition includes acts with adverse outcomes committed not only by people known to and trusted by the victim, but also acts perpetrated by strangers and by institutions.
The following are given in the study as common examples of financial abuse:
- misappropriation or misuse of money, property or assets
- exerting undue influence to give away assets or gifts
- putting undue pressure on the older person to accept lower-cost or lower-quality services in order to preserve more financial resources to be passed to beneficiaries on death
- carrying out unnecessary work or overcharging for a service
- misuse of powers of attorney
- denial to access funds
- failure to repay loans
- living with the older person and refusing to contribute money for expenses
- forging or forcing an older person’s signature
- promising long-term care in exchange for money or property and then not providing the promised care
- getting an older person to sign a will, contract or power of attorney through deception, coercion or undue influence
- abusing joint signatory authority on a blank form
- getting an older person to be a guarantor for a loan where the benefit of the loan is for someone else without sufficient information or knowledge to make an informed decision.
The Victorian Department of Health and Human Services expands upon this, pointing out that financial abuse is often combined with other forms of abuse and neglect.
You can always speak with your Accountant or reach out to the following organisations:
It is imperative that you keep your personal information secure, the ATO has released another warning about increased scam activity this year.
From the ATO
Scammers frequently claim to be from the ATO and according to Ms Anderson, you should be wary of any phone call, text message, email, or letter about a tax refund or debt, especially if you weren’t expecting it. “The ATO regularly sends emails and SMS’s and we make lots of calls each week. But there are some tell-tale signs that it isn’t the ATO, including that the ATO will not:
- use aggressive or rude behaviour, or threaten you with arrest, jail or deportation;
- request payment of a debt via iTunes, pre-paid visa cards, cryptocurrency or direct credit to a bank account with a BSB that isn’t either 092-009 or 093-003;
- request a fee in order to release a refund owed to you; or
- email or SMS you asking you to click on a link to provide login, personal or financial information, or to download a file or open an attachment.
Last year the ATO received over 81,000 scams reports, with more than $2.4 million being paid to scammers and almost 10,000 people providing their personal information. Ms Anderson says that while the ATO will act on reports, the best way to stop the scammers is for the whole community to protect themselves and others, especially the elderly and people who are isolated.
The ATO’s dedicated scams line is 1800 008 540.
An excerpt from ASIC.
If you require assistance with this matter please contact the office.
“From November 2018, trading names will be removed from the ABN Lookup. The ABN Lookup contains a list of all Australian Business Numbers (ABNs) and any associated business names.
If you want to trade under a specific name, you’ll need to register it as a business name with the Australian Securities and Investments Commission (ASIC).
You don’t need to register a business name if you trade under your own name (‘John Smith’), but you’ll need to have a business name if it’s anything else (‘John Smith Plumbing’).”
Passed Personal Income Tax Rates from ATO
||Tax on this income
|0 – $18,200
|$18,201 – $37,000
||19c for each $1 over $18,200
|$37,001 – $90,000
||$3,572 plus 32.5c for each $1 over $37,000
|$90,001 – $180,000
||$20,797 plus 37c for each $1 over $90,000
|$180,001 and over
||$54,097 plus 45c for each $1 over $180,000
The above rates do not include the Medicare levy of 2%.
The above rates include changes announced in the 2018-19 Federal Budget.
If you think you the end of financial year is all about complying with the taxman you are missing the best time to assess your fiscal health. If you haven’t done this before consider the following:
- Review: When you are finding all those receipts and completing your logbooks for your tax return, go through each months banks statements and start categorising your expenses e.g. food, fuel, car repayments etc.
- Assess: Did you spend too much? Do you really need those pair of shoes? What do my savings look like? What big ticket items are coming up? What does your financial health look like.
- Act: Put in a place a budget, set goals and don’t give up if you fail. If you need to seek a financial adviser take your time and have a clear direction of what you want to achieve more importantly what you want from that relationship.
When it comes to claim deductions it is more important to keep to your record keeping obligations. Ensure that what you are claiming is true and correct and that you have clearly communicated it within your submitted documents. Once you have received your tax return, you must read, check and ensure that the information is true and correct.
Much has been in the media about work related expenses (including car expenses) and the ATO’s ability to data match with other databases e.g. State Revenue Office. We have always believed that there should always be an expectation that you will be audited.
For peace of mind, we are offering Tax Audit Insurance for all client types and is your policy (portable). It extends to some other government agencies and is not just limited to accounting fees. (When making your next appointment ensure that you have discussed whether this is right for you).
It also pays to be proactive and discuss your financial year with us before its over to tax plan and become fiscally fitter.
If you have found this information of interest or wish to discuss your personal situation please contact us to make an appointment.
General Advice Warning
The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.
Taxation, legal and other matters referred to on this website are of a general nature only and are based on the author’s interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.
Our clients benefit from the time we take to ensure they understand their tax obligations and the care we take with each personal situation.