As the ATO reminds investors of their tax obligations, Binance Australia is ramping up its user compliance
Binance has been having a tough time with compliance lately, facing warnings from regulators in the UK, Japan, and the Cayman Islands. Binance Australia, though, is ramping up its efforts to help users comply with the country’s tax laws.
The Australian Tax Authority (ATO) sent a letter to 350,000 Australian crypto investors last year to remind them that disposing of cryptocurrency could result in capital gains tax obligations. The ATO sent another reminder this year, explaining that it would be collecting data from crypto exchanges to determine tax liability.
Sam Teoh of Binance Australia said, “With approximately 1 in 6 Australians investing in crypto, taxpayers and tax agents alike are on a steep learning curve. Our community has voiced their concern around tax compliance and we’re committed to supporting them with the resources they need.”
This will involve the exchange improving its consumer education, including hosting a series of end of the financial year crypto tax masterclasses. Binance will also be helping users to more accurately report their crypto holdings for tax through its new partnership.
Teoh explained, “In 2021 the regulatory framework surrounding crypto demands a responsible and transparent approach by all players. We’re giving our users the best possible opportunity to stay on the right side of the ATO by officially partnering with Koinly this tax season.”
Founded in 2018, Koinly provides crypto tax software to traders and investors in more than 20 countries across the world, including some of Australia’s top accountancy firms.
Koinly’s Robin Singh said, “The ATO is collecting bulk records data from Australian crypto exchanges and comparing it to amounts entered on previous tax returns. Failure to declare crypto gains can attract a penalty of 75% of the outstanding tax liability.”
With Koinly, users can sync all their wallets and exchanges in one place and the software imports all their transactions, finds market prices at the time of trades and calculates taxes.
Singh added, “While Australia is lucky to have clear guidance on crypto tax rules, the requirement on taxpayers to keep audit-worthy reporting unfortunately exposes investors to penalties. Getting your taxes right is incredibly important, which is why we’re proud to offer reporting that is robust enough for tax agents and audits.”