The National Tax Service of Japan introduces a special taxation procedure for income received by traders from trading cryptocurrencies. About writes this Bloomberg.
Cryptocurrency traders in Japan will have to give up to 55% of their income to the government
Also in Last year the agency established that capital gains associated with cryptocurrency transactions must be classified as “other income” and reported on in the declaration filed annually from February 16 to March 15.
However, unlike income received from trading stocks and foreign currencies, which is taxed at 20%, the agency plans to withhold from 15% to 55% from cryptocurrency traders. The maximum rate will apply to individuals with annual income of over 40 million yen ($ 365,000).
Since in certain jurisdictions, such as Singapore, the income generated from cryptocurrency trading, are not taxed, some large investors have already left Japan, said Kengo Maekawa, head of Shiodome Partners Tax Corp. Maekawa, which is increasingly being approached by new clients for advice on taxation of cryptocurrencies.
At the same time, the information provided by the government on this matter is far from exhaustive. Hiroyuki Komiya, the head of a Tokyo-based blockchain consulting company, said that he was able to reduce the tax base “by several million yen” by simply focusing on the “overall average” instead of the “moving average”.
“The government did not clarify the details, so I don’t know if this can be done or not,” he explained, adding that he may have to withdraw some of the cryptocurrency assets into fiat in order to be able to pay taxes..
Meanwhile, the tax office is creating a database for accounting for cryptocurrency traders and is closely monitoring the activity on exchanges..
Recall that earlier European legislators came up with an initiative to tax cryptocurrency transactions.
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