Keeping YOU informed – Cryptocurrencies
PayDay Software Systems strives to keep clients informed and up-to-date with new developments, latest system amendments and legislative changes. In this instance we would like to inform you of the following with regards to ‘Cryptocurrencies’
Cryptocurrencies are treated differently in some countries for example Bitcoin:
- In the USA, is treated as Property.
- In Australia, is treated as an Asset.
- In Canada, rules for barter trade applies – i.e. an asset/goods as a substitute for cash.
Pertaining to the impact thereof in South Africa, SARS has formally released their views on taxation of cryptocurrencies (e.g. Bitcoin), which is that income received in the trading of cryptocurrencies is viewed as taxable income, and must be declared within the tax year in which it is received or accrued. SARS clarifies that since the term “currency” is not legislated in South Africa in the Income Tax Act, cryptocurrencies are viewed by SARS as assets “of intangible nature“.
To find out more about dealing with this, please follow this link.
Payroll should take this opportunity to make this known to business, as people become attracted to this type of investment, and may unwittingly fall foul of the law.