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ATO releases ruling on bitcoin

The ATO has issued its decision on the treatment of bitcoin, and other crypto-currencies, for tax purposes. Bitcoin is a form of virtual digital currency that has been gaining popularity worldwide. Based on the ¬†average number of daily transactions, bitcoin has overtaken western transfer and is fast approaching PayPal as the world’s most popular form of online transaction.

Bitcoin is unregulated and operates outside of the global financial system. The ATO has ruled that making purchases with bitcoin essentially amounts to bartering, and as such the virtual currency will be treated as an asset, rather than as money, for tax purposes.

In the eyes of the ATO, bitcoin will be treated similarly to shares. There is no need for individuals to declare bitcoin to the ATO until they dispose of it, in which case it may be be subject to capital gains tax. Individuals may also use bitcoin to purchase up to $10 000 worth of personal items, and it will be considered as personal assets use. If an employee receives bitcoin as part of their remuneration package then this may be subject to fringe benefits tax.

Bitcoin enthusiasts across the country have expressed disappointment in the decision, claiming that it will drive investment in bitcoin offshore, and cut Australia our of the emerging digital currency economy.

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What to consider when consolidating your super

August 27, 2020

The ATO reported that 45% of working Australians were not aware that they had multiple super accounts in 2016. Having multiple super accounts is particularly common for individuals who have had more than one job. If this is you, it is important to identify and manage your super accounts because having more than one can be costly as a result of account fees from multiple funds.To combat this, you may want to consolidate your super, which moves all your super into one account. Not only does this save on fees, but it also makes your super easier to manage and keep track of.

Before consolidating your super, it is important to do the following:

Research your funds’ policy
Compare your active super accounts so you can make the right choice about which one you should close. Things to assess include:

Check employer contributions
Changing funds may affect how much your employer contributes, as some employers contribute more to certain funds. Check your current accounts to see if changing funds will affect this. Once you have selected a super fund, regardless of whether you choose a new super fund or one of your existing ones, provide your employer with the details they need to pay super into your selected account.

Gather the relevant information
When consolidating your super, you will need to have the following details ready: