A senior official at the tax office cites that they would focus on capital gains in digital assets because it was impossible to offset digital assets’ losses against a tax payer’s earnings.
Australian Tax Office to Concentrate on Digital Assets’ Capital Gains in 2022
The difference between an asset’s buying and selling price tells its capital gains or loss. Reports say that the ATL would Levy a percentage on capital gains in the digital assets’ industry, based on the tax payer’s income and the asset’s holding time.
However, the tax rate for a holding period of more than a year in Australia would be lower than that for assets held for a year and earlier. The office has reportedly issued series of warnings to investors in the digital assets’ industry.
Moreover, it had also indicated that it would concentrate on non-fungible token to ensure that holders accurately fill tax papers. Speaking on the new plans, an official at the tax office cites that it was adopting the focus area because it was impossible to offset virtual assets’losses against the payer’s earnings.
The Australian Tax Office would also concentrate on other taxation areas apart from capital gains from digital assets’ investments. Rental properties, record-keeping, and on-the-job expenditure are the other three taxation areas the Tax Office said it would concentrate on in the year.
As the performance of most digital assets plummeted in the year, the Australian Tax Office added that its citizens must accurately report the figures concerning any sale of digital assets, including non-fungible tokens. It said that it would take punitive actions against defaulters who aim to provide inaccurate information.
The representative of the nation’s tax office said the organization already holds rough data about the investment activities of its residents. However, he enjoined all involved stakeholders to maintain accurate reporting of their reports to prevent including any penalties.
According to the Tax Office, it received ample data concerning the areas in its focus areas, including income from rental properties, and capital gains from the digital assets and capital market. But it maintained that it expected the concerned persons to fill the tax details themselves.
However, the tax office’s representative said that there’s an increasing number of digital assets’ investors who might be unaware about how to accurately report their trading data.
Meanwhile, Australia recently launched its first set of exchange traded funds with three offerings. Reports say that the ETFs saw up to $1.3 million in traded volume on a challenging first day in public. The challenge of the ETF floating, reportedly stems from the unsavory state of the global virtual assets’ industry.
Two of the ETFs concentrated on Bitcoin-related offerings, while the third ETF concentrated on Ether-related offerings. However, there are predictions that the ETFs could see up to $1 billion in incoming resources in the coming days in Australian markets.