So you got that cryptocurrency collection humming along, and you’ve managed to make some proper dosh along the way.

Stoked, but if you think the tax man isn’t looking over your shoulder then think again.

We all know that SARS have a serious deficit to make up thanks to all those years of pilfering, so of course they weren’t going to let that crypto-cash pass them by.

They recently outlined their stance on the matter, with this below via Business Day:

The revenue service said it deemed cryptocurrencies – such as bitcoin and ethereum – as intangible assets, rather than “a currency for income tax purposes or capital gains tax”.

The onus was on taxpayers to declare all cryptocurrency-related taxable income in the tax year in which it is received or accrued, SARS said in a statement. Failure to do so could result in interest and penalties, it said…

In its statement, SARS said taxes could be applicable to cryptocurrency mining, trades on cryptocurrency exchanges, and the purchase of goods and services using digital money.

Meanwhile, taxpayers were entitled to claim expenses associated with cryptocurrency accruals or receipts, provided that this expenditure related to the taxpayer’s income generation “and for purposes of trade”.

Look, I just dabbled a bit on Luno, so what the hell does all that mean for someone like me?

You can see the full statement from SARS here, but like all this tax-related I just defer to the experts.

They’ve helped us with figuring out the latest income brackets, they’ve unpacked the new VAT increase, and they’ve been on top of everything tax-related for the past 12 years.

We’re talking about Galbraith | Rushby, of course, so if you want hassle-free tax services (including figuring out your new cryptocurrency tax implications) then you know where to start.

No one wants to be stung down the line, so do it right the first time.

[source:businessday]