Russian traders are preparing for crypto-tax season
Russian crypto holders were warned that they had a month before local tax services started checks on miners, crypto holders and traders that were to declare income for transactions with digital assets
Russian crypto industry has got a month to declare crypto
Despite the country is still in the process of developing general crypto regulation, there have already been some changes brought to the tax code this year. It means that any Russian who was making money on crypto last year should report the profit received from this.
According to RBC, Russians were initially required to provide tax declarations including data on their crypto income by the beginning of the next month, and the new deadline was established for July, 30th because of disruptions caused by the coronavirus pandemic.
Individuals will be taxable according to the flat rate 13%, according to Article 220 of the Tax Code of Russia.
Nevertheless, there is still much confusion for crypto users who are unaware of how exactly that should report their crypto revenue, and how to calculate the total cost in roubles of transactions made in crypto several months ago.
RBC quotes the tax layer who states that companies and individuals dealing with mining, trading or other activities associated with crypto-stacking, should declare their crypto income, otherwise they risk falling under sanctions.
Meanwhile, Michail Uspensky from the Moscow department of the Association of Russian Lawyers has announced that crypto holdings are free of tax. Rather, it is about the deals in which crypto assets are converted into fiat.
Lawyers have also stated that some Bitcoin (BTC) and altcoin purchases may also be taxable.
Still, it is impossible to avoid some cunning calculations because, as Uspensky added, a trader will have to deduct the token purchase price from the asset’s cost while selling in order to figure out the tax amount he/she needs to pay for profitable crypto-fiat trading.
Besides, companies face additional issues such as different tax rates varying from 6% to 15% depending on which type of legal person they are registered in.
The lawyer warns that introduction of declarations is only the beginning, and this can be followed by next steps, “Tax services will ask you a lot of questions to find out which crypto transactions were profitable, what costs you bore and how they are related”.
