According to a report, the Australian Tax Office (ATO) will seek out bitcoin investors with outstanding tax liabilities. Will Day, ATO deputy commissioner stated that transparency will be achieved due to forthcoming AML measures. It will grant the tax office increased probing powers next month.
The new policy will provide oversight of the crypto market and will include compulsory 100-point identification checks for crypto traders. At the moment, ATO does not consider bitcoin as a legal tender.
The new measures will extend the jurisdiction of the Australian Transaction and Reports Analysis Centre (AUSTRAC). The financial agency will be able to access cryptocurrency exchange records. Besides KYC and AML, the exchanges must report about suspicious transactions, as well as any cash transaction in excess of 10,000 Australian dollars.
According to a member of the National Tax Liaison Group and CPA Australia chief, Paul Drum, traders are curious whether bitcoin investments are exempt from capital gains tax personal asset rules.
Where you use bitcoin to purchase goods or services for personal use or consumption, any capital gain or loss from disposal of the bitcoin will be disregarded (as a personal use asset) provided the cost of the bitcoin is $10,000 or less.
The Australian Tax Office
Paul Drum also stated that the effectiveness of the anonymity of Bitcoin and other cryptocurrencies is starting to fade. These coming changes mean that people shouldn't assume they can hide forever behind blockchain technology, nor should they assume there are no tax consequences.