Source: Taxation In Australia Journal Article
Published Date: 1 Feb 2018
Cryptocurrencies are an emerging form of global currency which aims to revolutionise and challenge the traditional ways in which parties transact with each other. Bitcoin was the first cryptocurrency: a digital cash system without the need for a central controlling entity, where transactions are verified by a peer review system. In 2014, the ATO responded to the emergence of cryptocurrency by releasing guidance on its views of the taxation of bitcoin and other cryptocurrencies that shared the same characteristics as bitcoin. This article explores some of the challenges in applying the historic Australian taxation system to cryptocurrencies. It suggests that, given the changing environment and widespread acceptance of cryptocurrencies in recent years, the ATO may wish to reconsider the view expressed in TD 2014/25 that bitcoin is not a foreign currency for the purposes of Div 775 of the Income Tax Assessment Act 1997 (Cth).
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