Cryptocurrency Accounting Services

Cryptocurrency Accounting Services

We provide professional and tailored Crypto currency tax advise and bookkeeping service to crypto currency investors, traders, miners and businesses who accepting crypto currency as payment. Our expertise could help you to find the best tax structure as a vehicle to carry the crypto currencies, whether it will be a company, a trust or a superannuation fund to achieve the best tax result.

Cryptocurrency Tax Accountants Melbourne

Basic tax treatment of crypto currencies in Australia

If the cost of your digital currency is less than $10,000 and you are only using it to pay for personal goods or services, it is not taxed. However, according to the Australian Taxation Office (ATO), if you are using virtual currencies, such as bitcoins, for other purposes, you will be taxed. Here is an outline of the ATO’s proposed tax treatment of crypto currencies:

  • Investment- If you hold digital currencies as an investment you will pay capital gains tax on any profits when you sell them.
  • Trading- If you trade virtual currencies for profit, the profits will form part of your assessable income.
  • Carrying on a business- If you use cryptocurrencies to pay for (or accept them as payment for) goods or services, the transactions will be subject to goods and services tax (GST).
  • Mining bitcoin- If you are mining bitcoins or other digital currencies, any profits you make will be included in your assessable income.
  • Conducting an exchange- If you are buying and selling cryptocurrencies as an exchange service you will pay income tax on the profits and transactions will be subject to GST.
  • ATO data matching Crypto currency transactions!

ATO have started collecting bulk records from cryptocurrency digital currency exchanges where individuals and businesses buy, sell and transfer cryptocurrency. The data will be collected on an ongoing basis. This will allow ATO to verify purchase and sale information by matching the data with taxpayer records.

Bookkeeping for Crypto currencies

It is vital to keep good records for all your transactions with cryptocurrency, whether you are using cryptocurrency as an investment, for personal use or in business.

You need to keep the following records in relation to your cryptocurrency transactions:

  • 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

Keeping good records will make it easier to calculate and meet your tax obligations, and if you are in business, they will assist you to manage your cash flow and see how your business is doing.

We can assist you to meet your record keeping obligations and working out your tax. For more information please feel free to contact us now!