The Australian Taxation Office (ATO) has launched a data collection and matching program to ensure people trading in cryptocurrency are paying their fair share of tax.
The ATO is collecting bulk records from Australian cryptocurrency designated service providers (DSPs) including cryptocurrency purchase and sale information.
Deputy Taxation Commissioner, Will Day said the data would make up a key element in the ATO’s compliance program.
“The ATO uses third-party data to improve the integrity of the tax system by identifying taxpayers who fail to disclose their income details correctly,” Mr Day said.
“We also use third-party data to assist taxpayers in meeting their tax obligations through pre-filling of tax returns,” he said.
“This data will be collected under notice from the DSPs on an ongoing basis.”
He said the move was necessary because there had been significant growth in participation of crypto-assets in recent years, with estimates that between 500,000 to a million Australians had invested in them.
“Cryptocurrency has been used to move funds within the black economy, hide money offshore, and is sometimes linked to risks with unexplained wealth and undeclared taxable capital gains,” Mr Day said.
“The ATO will be working with other regulators, in particular the Australian Transaction Reports and Analysis Centre and the Australian Securities and Investment Commission, to ensure that tax law requirements align with a whole-of-system approach.”
He said the ATO was also working at the international level as part of the Joint Chiefs of Global Tax Enforcement (J5) aimed at investigating cryptocurrency-related tax evasion and money laundering.
