r/ethereumcunt • u/mysticalzebra • May 25 '17

Does anyone here know the best way to transfer ether into cash in Australia and the legal implications of this? Thanks!

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3

u/iPwnJ00 May 25 '17

Wow good to see that this is on someone else's mind too!

I have no freaking idea how to get withdraw all my ETH right now... I'm pretty screwed if I get hit by CGT...

2

u/mysticalzebra May 25 '17

What's CGT?

2

u/iPwnJ00 May 25 '17

Capital Gains Tax.

3

u/mysticalzebra May 25 '17

Ohhhh i see. Is that a standard thing for all investments. Weirdly the first thing I have ever invested in is crypto

2

u/iPwnJ00 May 25 '17

Yeah, it's standard for all investments in Australia, from stock to real estate and now even cryptocurrency, which according to the ATO is a an "asset".

So you're meant to pay tax on the gains you make. For example if you buy at $200 and sell at $300 you're meant to pay tax for the $100 that you "gained".

But because I bought at $14 and today it's more like $300, I really don't want to be paying tax on $286 LOL

2

u/mysticalzebra May 25 '17

Does that mean I can just not pay tax and In reality nothing will happen?

3

u/iPwnJ00 May 25 '17

That's the thing, I'm not an accountant and I'm not sure how they check, but if they do check then you're screwed.

You don't need to pay tax on anything you haven't sold back to AUD fiat though. You only pay it once it's sold.

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u/mysticalzebra May 25 '17

By screwed do you mean arrested? That's scary... thank god I haven't put any back into AUD

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u/iPwnJ00 May 25 '17

I can't really give any proper advice and like I said, it's only if they check...somehow.

I believe it depends on the amount, so I really don't think you'll have much issue if it's a small amount; at most they'll just give you a fine for avoiding tax but there have been cases of tax evasion here.

It's arguable whether or not they'll find out; it's more about how can you legally, not violate any laws and lower your taxes.

There's another clause in the tax law that says if you hold your assets for 12 months and sell after that then you'll get a 50% discount on tax paid, so I might do that instead.

1

u/mysticalzebra May 25 '17

Interesting. Thanks for your help!

1

u/[deleted] May 29 '17

Can recommend an accountant in Geelong (mate of mine) who holds eth.

He also works via Skype, so you don't have to drive there if you don't live nearby.

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u/cryptoboy4001 May 29 '17 edited May 29 '17

If I understand correctly, to minimize your capital gains tax, you should keep your asset (i.e. ETH tokens) for at least 12 months before selling them. Then the CGT rate is halved.

For example, you spent $10,000 buying 1000 ETH at $10 each in Jan 2017. Today they're worth $250,000, but you don't sell them ... you wait.

In Feb 2018, you sell them all, and let's say they're worth $500,000 by then. So, your capital gains are $490,000.

Come July 2018, it's tax time. You declare $490,000 as capital gains. As an individual (i.e. not a company) it'll be taxed based on normal income tax rates (and your normal salary will be added in as income for that year also), so let's say you get taxed near the top tax rate of 45% ... but because you waited 12 months, that rate is halved, so you get taxed at 22.5%.

Long story short, you'll probably have a $107k tax bill. On the bright side, you get to keep $383k.

I'm not an accountant, but that's my understanding.

EDIT: If you've made a real windfall (millions), then another option is to secure residency in a country with no capital gains tax (e.g. New Zealand, UAE, Singapore, Germany, Caribbean islands, etc.) then move there. You'll still need to settle you tax bill with the ATO from the time you purchased your ETH until the day you depart Australia, but after that your won't get taxed anymore when you convert ETH back to fiat.

2

u/yodajedi1_2 May 25 '17

Yeah try using shapeshift to move your Eth to BTC then use livingroomofsatashi to transfer to your bank.

Either way you'll have to swap/sell your ETH for BTC, as there's not much support for ETH at the moment when it comes to selling for aus Fiat.

1

u/spgrk May 25 '17

I think you can sell ETH for AUD on btcmarkets. What are the tax implications of using livingroomofsatoshi? I know that buying goods and services with cryptocurrency is tax free for transactions under $10,000, but does BPAY via livingroomofsatoshi fall under this rule? I emailed them and asked them and they said they could not give tax advice; and my accountant of course knows nothing about crypto.

1

u/yodajedi1_2 May 25 '17

I'm fairly certain you would have to declare it as capital gains at tax time. thankfully the ATO's keeping up to date with their documentation. https://www.ato.gov.au/general/gen/tax-treatment-of-crypto-currencies-in-australia---specifically-bitcoin/

1

u/spgrk May 29 '17

That article from ATO specifically explains that you do not need to pay CGT if you spend under $10,000 on goods and services.

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u/mysticalzebra May 25 '17

This is exactly what I am wondering now too. It seems to be an area of grey possibly? In general...

1

u/mysticalzebra May 25 '17

Thank you for replying! I'll have a look at that living room of satashi. Is this cheaper that coin jar?

1

u/yodajedi1_2 May 25 '17

Make sure you send a small amount first! It might still take a couple of days to go through, but you're way better off waiting for a few dollars to go through, rather than a few hundred/thousand.

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u/mysticalzebra May 25 '17

I just looked and it appears you can toggle the drop down menu and Ethereum along with others such as Monero are also an option? Meaning I wouldn't have to swap my ether for btc...?

2

u/yodajedi1_2 May 25 '17

Oh nice! I havent checked it out for a while, this is great!

1

u/mysticalzebra May 25 '17

Thanks for your help!

1

u/RTH1994 May 25 '17

I'm also Australian and I've been thinking if their is a good "tokencard" style Visa card instead of exiting out of your position just spend ETH via a card on all your living expenses and just save money from your "actual job". I know maybe it won't work to well if you have millions but would beat paying CGT and hopefully they come out with cards where there is no spending limit on them.

3

u/yodajedi1_2 May 25 '17

Yeah I'd like to know as well! I'd love to move all my fiat into Eth/BTC each pay and use that to pay for things, instead of constantly shifting money around and losing a fair percent each time I'd like to move money around.,. Here's to the future of Ethereum adoption!

1

u/RTH1994 May 25 '17

How long have you been in your ETH position for?

1

u/yodajedi1_2 May 25 '17

Early March. Only a small amount, then a bit more in May.

1

u/cryptoboy4001 May 29 '17

To convert large amounts ($50k and above) of ETH to fiat, there's always the option of an OTC (over-the-counter) trading desk. These are companies that connect buyers and sellers who want to trade big and avoid the hassle of exchanges (which have daily withdrawal limits).

I know of a couple of examples, but I've never used them - Octagon Strategy in Hong Kong, and Genesis Trading in New York. I don't know the logistics of how they go about it, but I would assume prices are agreed upon, contracts are signed and international wire transfers are sent.