In some countries you are liable for capital gains tax on any profits you make on your cryptocurrency hodlings. Calculating how much you owe can be confusing, but it just got a bit easier for Australian cryptocurrencers.
Today, KPMG announced a new tool, the “Crypto Tax Estimator,” that helps Australian hodlers estimate how much tax they could owe as a result of their cryptocurrency tradings.
The tool is currently only available on Australian cryptocurrency exchange Independent Reserve (IR) via an API. The API could theoretically be opened up to a wider range of platforms in the future, although there has been no mention of this yet.
The tool takes into consideration users’ holdings and transaction activity to give an idea of how much tax they might be liable for. It covers all cryptocurrencies available on IR at the moment, including Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and XRP.
It should be noted the figure is just an estimate, you’ll have to double check to make sure you’re not under or over paying.
“The possibility of being non-compliant is a major source of legal risk,” said KPMG Australia’s Head of Blockchain Services Laszlo Peter in the announcement. “We want to provide an easy-to-use tool that may assist participants in the newly emerging token-based economy to understand their tax obligations.”
Sure the government can’t control blockchain or cryptocurrency, but it can enforce tax on its citizens. If you’re a cryptocurrencer who lives in country that includes cryptocurrencies in its capital gains tax legislation, you are legally obliged to make sure you are paying the right amount of tax.
Indeed, Australia isn’t the only country trying to make it easier for cryptocurrency holders to understand capital gains tax. Recently French regulators announced that any profit made on cryptocurrency would be subject to a flat-rate capital gains tax of 30 percent.