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CoinJar: New ATO Guidance Affecting Bitcoin Buying/Selling

Avatar newsbtc 5 years ago

Australia’s leading bitcoin services company, CoinJar, published a blog post on Tuesday noting that a recent tax guidance from the Australian Tax Office (ATO) issued in August will impact the buying and selling of bitcoin on the service.

According to the guidance, the supply of bitcoin is taxable for GST — the goods and services tax.

What this means for consumers depends on the situation. Here’s how CoinJar says it’s all expected to play out:

Buying bitcoin

As per the guidance, when buying bitcoin is Australia, the GST is applicable. Therefore, any price quoted to the buyer should include 10 percent GST. The seller must pay the GST to the Tax Office appropriately.

So as of October 3rd, when you buy bitcoin at CoinJar, they’ll charge you 10 percent GST. They’ll then generate a tax invoice showing how much GST was paid by the buyer.

Selling bitcoin

Converting bitcoins to Australian dollars is different. If the seller is not a GST-registered business, the GST will not apply when you place a sell order. On the other hand, if you are a GST-registered business, you will need to collect GST as part of your sales (much like CoinJar will).

Customers selling for personal use are not affected. If a customer is selling on behalf of a GST-registered business, they will be prompted to register their status at the time of the sale. CoinJar will ask the user to confirm their GST collection, and then a recipient created tax invoice (or RCTI) will be generated on the user’s behalf with GST applied.

CoinJar’s recently-launched Swipe card is not affected by GST, and the company will begin working shortly to upgrade their systems to prepare for their GST liabilities.

“In many ways the guidance has brought clarity to the position of bitcoin users in Australia,” the company writes. “However, we don’t believe the ATO’s guidelines are ideal for bitcoin in this country. We believe in a simpler financial system, and we will continue work with the ATO to help them discover a fairer position.”

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