KPMG Australia and Independent Reserve, the largest Australian cryptocurrency exchange, today announced the launch of a new tool to help the traders of cryptocurrencies better understand their tax liabilities.
The Crypto Tax Estimator developed by KPMG is a digital tool that plugs directly into Independent Reserve’s user interface, allowing traders to estimate tax obligations on their portfolio all with just the click of a button. Initially conceived during a KPMG Hackathon, the technology was developed based on the combined expertise from KPMG’s tax technology, tax, risk and compliance, and blockchain specialists.
Laszlo Peter, KPMG Australia’s Head of Blockchain Services, commented: “It is estimated that hundreds of thousands of Australian companies and individuals are trading crypto assets. But in this complex and fast-emerging area, there are few sources of guidance that can help people easily understand the potential tax implications of trading, such as capital gains tax. The possibility of being non-compliant is a major source of legal risk, and we want to provide an easy-to-use tool that may assist participants in the newly emerging token-based economy to understand their tax obligations.”
The Crypto Tax Estimator is an Application Programming Interface (API) that enables Independent Reserve to provide their users an estimate of their potential tax exposure in real-time, based on the users’ buy/sell transactions on the exchange. The tool covers all cryptocurrencies exchanged on Independent Reserve, including Bitcoin, Bitcoin Cash, Ethereum, Litecoin and XRP.
Commenting on the announcement, Independent Reserve CEO Adrian Przelozny said: “The roll out of the Crypto Tax Estimator tool is a huge leap forward for guidance on tax implications within crypto trading. The Australian Tax Office (ATO) has made it clear that anyone involved in acquiring or disposing of crypto assets needs to be aware of the tax consequences, this tool provides our customers for the first time with a simple way to view this information.”
“While there are other websites and tools available, this is the first bespoke API to plug directly into a crypto exchange that is backed by a global professional services firm,” Mr Przelozny added.
“As the first exchange to be regulated by the Australian Transaction Reports and Analysis Centre (AUSTRAC), we are firmly committed to making the crypto market more attractive for local retail and institutional investors. This tax tool is a piece of critical infrastructure that will help our users understand and help manage their risk.”
Currently, the Crypto Tax Estimator is exclusively available to traders on Independent Reserve.
“Cryptocurrency markets are growing at a rapid rate across the world, and it is important both for the crypto traders and governments that taxation rules and tools evolve to keep up with this fast-emerging area,” Mr Peter said.
“We are excited to be helping IR launch this new tool here in Australia. This is another example of how KPMG is continuing to expand our portfolio of cryptoasset services globally.”
KPMG has also just released a new report, “Institutionalization of cryptoassets” that looks at how institutionalizing cryptoassets is necessary to facilitate scale and drive growth for crypto.
KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 154 countries and territories and have 200,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.
Launched in 2013, Independent Reserve is one of the first digital currency exchanges in Australia with the mission of transforming cryptocurrency technology into secure, robust and regulated financial services. As an industry member of the Australian Digital Commerce Association, we are committed to institutionalising the cryptocurrency industry and making it more accessible to all.
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KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.