- The South African Revenue Services have published regulations for how cryptocurrency profits will be taxed
- Cryptocurrencies are unregulated in most countries and have historically not been taxed, making South Africa a pioneer in this regard
- While it may seem like cryptocurrency transactions are secret, authorities can access information regarding profits
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PRETORIA - The South African Revenue Services (SARS) has announced that it will like to institute regulations around cryptocurrencies such as Bitcoin. They have published a page called Crypto Assets & Tax online, which informs cryptocurrency owners on how they will be taxed.
The reason behind SARS's move is that cryptocurrencies are decentralised and therefore unregulated in most countries as governments are not sure how they should be taxed.
The page states that profits which South Africans make from trading cryptocurrencies will be liable to taxation. The profits will be classed as either revenue or capital, depending on the specific case it applies to, BusinessTech reports.
Cryptocurrency traders prepare to submit tax
According to Business Insider, audit notifications have been sent to some cryptocurrency owners which request them to state why they invested in these digital currencies. They also have to submit documentation from the platforms they invested in to confirm how much they bought and earned.
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Cryptocurrency platforms generally do not provide investors with tax certificates as the regulations previously didn't exist and made tax calculations nearly impossible. These platforms have also previously not shared customer information with any revenue agencies.
Investors in cryptocurrencies have been led to believe that their transactions and earnings are private, but with efficient tools and the proper knowledge, experts can trace this information. If SARS invests in these tools and skills, they can track tax evaders.
Sandile Shezi: Bitcoin trader in police custody
Previously, Briefly News reported that 29-Year-old Sandile Shezi, the Bitcoin trader who is being accused of defrauding investors, is finally in police custody after he handed himself in.
Shezi through his legal representation has maintained his innocence despite multiple people coming out and stating that they have been duped by the self-proclaimed millionaire.
At the time, his legal team stated that Shezi only found out he was a wanted man through media reports and was not served with any legal instructions personally.
Source: Briefly News