Whenever tax season rolls around, you might wonder whether you should be filing your crypto asset transactions.
Trading in crypto assets, whether buying, selling, trading, and/or earning payouts on the amount that you’re staking with Luno may be considered taxable where the South African Revenue Service (SARS) considers profits from crypto assets as capital gains or personal income, and depending on your personal circumstances. But luckily, hodling crypto is tax-free.
Note
SARS considers any gains on crypto assets to be taxable, even if the funds are not readily in your account and remain on an exchange or platform.
SARS has different rules for different types of crypto asset users, which depend on a number of different factors including if you are considered a crypto asset ‘investor’ or ‘trader’ as well as other details relating to your income:
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Traders are typically taxed on revenue income; whereas
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Investors will pay capital gains tax
The bracket you fall into will depend on your personal circumstances and the types of activity that you have engaged in.
So, either way I’m being taxed?
When filing your crypto asset taxes, it is crucial to account for all of your historical transactions for all wallets and exchanges. Luno provides a downloadable wallet statement for each of your Luno wallets recording all trades for each tax period, which you can use to manually calculate your taxes.
Guidelines from SARS are still in flux, so understanding your tax position isn’t always straightforward. If you need a hand, we suggest that you consult a tax advisor to assist you.
Tip
If you’ve still got a few unanswered questions, we’ve compiled a list of five misconceptions about crypto taxation.
Keep in mind
The information contained in this help centre article is not, and should not be construed as, financial advice, nor as tax advice, nor as a solicitation to trade. All opinions, news, research, analysis, prices, or other information displayed herein is provided for informational purposes only.
Tax consequences will naturally depend on the individual circumstances of the taxpayer concerned and, as such, are highly individual. You should accordingly consult with your own tax advisor for definitive advice. Luno shall not be liable to you for the accuracy of any information provided herein, and you expressly agree to waive any claim against Luno in this regard.