Amidst the confusing and contradictory regulatory policies towards crypto-assets globally, Belarus appears to be creating a clear accounting standard for crypto-assets.
The new accounting standard categorises digital tokens according to their acquisition and intended use. However, companies or individuals that deal with these crypto-assets must record and share certain information with the relevant authorities. It is hoped that clearer instructions will not discourage potential crypto business due to tax uncertainty.
The new standards are part of a presidential decree that will come into effect on March 28th and it is part of an effort to regulate the industry. The Ministry of Finance in Minsk is behind the concept and they devised the accounting system for crypto to crypto transactions. An area which has been a great source of concern for U.S. traders.
Tokens that are generated through ICOs have been categorised as investments. However, if their circulation period exceeds 12 months they will be classed as “Long-term financial investments”.
When the coins are purchased on a secondary market, for example and exchange such as Bittrex they will have to be reported as “goods”. Mining revenue in the form of crypto-assets are should be recorded as “finished goods”.
As traders and businesses try to account for the potentially massive profits generated over the 2017 rally clear regulations will be highly appreciated by nervous investors who wish to not owe the tax man.
Uncertainty In The U.S.
In the U.S. tax laws regarding crypto to crypto transactions are uncertain, however, tax professionals are telling clients to be on the safe side. Record all crypto to crypto transactions in order to pay capital gains as if it were a crypto to fiat transaction.
A reddit user by the name of thoway is unsure whether he owes the IRS (Internal Revenue Service) $50,000 in capital gains tax that he doesn’t have:
It is hoped that the impending law from the Belarus Ministry of Finance will clear many of these misconceptions to create a simple and robust crypto tax system meaning users like thruway don’t get caught out.
