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1 in 3 crypto owners confused about tax, study reveals

Australian cryptocurrency owners need to be aware of their profits and whether they incur tax, experts have warned.

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A recent study by the University of Queensland found that 1.5 million Australian cryptocurrency owners are uncertain whether their digital assets are tax-free.

The Tax Office would pursue all cryptocurrency owners who failed to meet their tax obligations, according to the study.

The study also noted cryptocurrency owners were set to find out the “hard way” that their assets are not tax-free, as the 31 October deadline loomed.

 

The research consisted of 745 coin holders and found that 66 per cent were aware they would need to pay tax on their cryptocurrencies if sold at a profit.

Eight per cent were unaware they would need to pay tax and a further 25 per cent were unsure.

It was highlighted that 64.5 per cent of the ‘unsure’ group were women.

The study said with an estimated 4.5 million cryptocurrency owners in Australia, 33 per cent would be unclear on tax obligations.

This would equate to 1.5 million coin holders who wouldn’t have budgeted for the required tax payments.

“Australians may not be fully aware of the potential tax consequences and may experience adverse events, which leave them financially vulnerable,” the study said.

“If investors are not aware, they may omit this on their annual tax return and be contacted by the Australian Taxation Office later when discovered.”

Results demonstrated that 49 per cent of ‘unaware’ respondents were tertiary educated, which experts noted as “surprising.”

Following the study, experts warned cryptocurrency owners to conduct due diligence before investing and to educate themselves on potential risks and how to avoid them.

Leading crypto analyst Sydel Sierra said it is vital coin holders understand the rules around cryptocurrency and that ignorance was no excuse.

“The reality is that cryptocurrencies are treated as personal income in Australia rather than a currency, which means when you sell, it will be subject to tax if there’s a capital gain,” Sierra said.

“This might come as a shock or frustrating if you didn’t know the ATO would come knocking, but the plus side is that the taxman only takes a percentage, not the whole lot.”

Taxable crypto amounts relied on personal income and would be treated as part of it, according to Sierra.

“If you’re a high earner in the top bracket, you’ll pay 45 cents to the dollar on your gains – that’s your reward for being independently wealthy.”

“The asterisk to all this is, if you sell your crypto after holding it for longer than a year, you’ll be eligible for a 50 per cent discount, meaning only half of your profits would be taxed.”

 

 

 

 

 

Imogen Wilson
28 October 2024
accountantsdaily.com.au

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Want to join our team? Various opportunities and positions become available from time to time. Currently we have the following positions available:

Accountant

Key Responsibilities will Include:

  • Preparation of Financial Statements and Tax Returns for Individuals, Companies, Trusts, Partnerships and SMSFs.
  • Preparation of BAS/IAS.
  • Preparation of Budgets & Cashflows.
  • Liaise with clients.
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Bookkeeper

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  • Bank Reconciliations for our small business clients.
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  • Payroll processing.
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  • Assisting accountants where necessary.

You’ll Need:

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  • Experience working with software programs including Xero, MYOB, Reckon and QuickBooks is highly desired.
  • High standard of written and verbal communication skills.
  • Meticulous attention to detail.

Graduate/Trainee Accountant

Key Responsibilities will include:

  • Preparation of Financial Statements and Tax Returns for Individuals, Companies, Trusts, Partnerships and SMSFs.
  • Preparation of BAS/IAS.
  • Liaise with clients.
  • Communicate with the ATO and other regulatory bodies.

You’ll Need:

  • Recently finished or currently studying towards your degree.
  • Motivation to undertake further study.
  • Excellent communication skills.
  • Eagerness to learn and high work ethic.

We offer full time, part time and casual employment options. All applications are treated with strict confidentiality.

If you are interested in applying for one of these positions, please email resume cover letter to accountant@mckinnonandco.com.au

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Philippa Whitting

Director

Education: Bachelor of Commerce, JCU

Qualifications: CPA, CTA, JP

Philippa commenced work at McKinnon & Co in 1982. In her spare time she enjoys looking after her beef cattle enterprise, equestrian activities, and spending time with family.

Stephen Klaproth

Senior Accountant

Education: Bachelor of Commerce – Major Accounting & Finance, USQ.

Qualifications: CA

Stephen works in our business services areas as well as assisting with Audits. On the weekend he enjoys the Tablelands outdoor lifestyle.

Chloe Bidner

Senior Accountant

Education: Bachelor of Business – Major Accounting, JCU.

Qualifications: CPA, Xero Advisor Certified.

Chloe works part time at McKinnon & Co predominantly in Business Services. When she is not at McKinnons, she works in her family business – FNQ Honey & Bees

Margaret Blakey

Senior Accountant

Education: Diploma of Financial Planning (Financial Services)

Qualifications: JP

Margaret commenced accounting in 1990, and has experience in the accounting, finance, banking and financial services sectors. In her spare time, she competes in dance sport ballroom dancing, as well as spending time with her family.

Leanne Johnston

Accountant. Manager of BAS, Payroll & Bookkeeping Department.

Education: Bachelor of Business – Major Accounting, USQ.

Qualifications: Xero Advisor Certified. Diploma In Accounting.

Leanne has recently completed her accounting degree and is looking to expand her knowledge with further study. In her spare time, she enjoys horse riding and planning travel adventures.

Valerie Orreal

Manager of SMSF Department.

Education: Bachelor of Science, JCU

Qualifications: Diploma of Family History

Valerie looks after all aspects of SMSFs. In her spare time, she enjoys reading, camping and beach trips.

Alison Richardson

Client Service Assistant

Alison started at McKinnon’s back in 1981 and is our longest serving employee, providing integral support to the office and our clients. She loves spending time with her family and spoiling her grandchildren.

Rebecca Setford

Receptionist

Bec helps manage the day-to-day operations of our front office. She enjoys working hard and learning new skills. Outside of work she is a keen gym enthusiast.

Georgia Barbagallo

Receptionist

Our newest team member Georgia is enjoying learning the running of our front office. She is also studying Education and enjoys spending time with her adorable sausage dogs.

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