The Australian Taxation Office (ATO) is sending a warning to all crypto holders in the country against failing to pay their taxes. It reminded the community that it has partnered with most digital currency exchanges, and it has all its trading data. Failure to pay the applicable taxes will attract penalties and possibly an audit. Assistant Commissioner Tim Loh said that one of the biggest myths Aussie investors have is that cryptocurrencies are a currency.
Tim Loh reveals over 600,000 Aussies have invested in digital currencies.
Speaking to a local news outlet, ATO official Tim Loh revealed that the agency’s data shows over 600,000 Australians have invested in cryptocurrencies. This year, the agency will be sending letters to around 100,000 taxpayers with digital currency holdings, urging them to review their previously lodged returns. In addition, it will prompt a further 300,000 people as they lodge their 2021 tax returns to report their digital currency holdings. According to Loh, Australian crypto holders have assumed that digital currencies are anonymous and that they can get away with tax evasion.
ATO is working with crypto exchanges to track tax evaders.
The Australian Tax Office has been tracking the channels through which these digital tokens interact with the traditional financial system. This includes working with the banks, the payment services providers, and the digital asset exchanges, all of whom have been very cooperative. “We follow the money trail back to the taxpayer, and we do that through the ATO which has data matching profiles with cryptocurrency exchanges, and they provide that information to us, and we use that information to cross-match with people’s tax returns,” he explained. Loh added, “There isn’t a game of hide and seek. We have got that information, and all we are asking people to do is follow the rules.”