It recently came to our attention that crypto exchanges will now be obliged to provide SARS with certain information from a small percentage of their clients for tax risk analysis purposes as per Section 46 of the Tax Administration Act, 2011.
Three of the country’s leading crypto agencies, AltCoinTrader, Luno, and VALR have consulted with the appropriate legal entities to ascertain the extent of their obligations under the Act. They wish to reassure their valued clients that the protection of their confidential information is still held in the highest regard at all times and emphasise that the scope of access to confidential information will be limited to the requirements of Section 46 of the Tax Administration Act only.
The purpose of SARS risk assessment
The purpose of the assessment is to ensure that a legal declaration of all taxable income related to crypto-currency activities is made by all taxpayers to a regulator (i.e. SARS). As recognised by Richard de Sousa, CEO of AltCoinTrader, compliance with the governing rules of the Tax Act will ensure that the industry as a whole can move forward in accordance with the legal requirements of the Act for the benefit and continued growth of the cryptocurrency sector.
Currently, crypto agencies are not yet obliged to provide clients with tax certificates; however, this could change in future if there is a need for further action to be taken with regard to crypto-assets. Nevertheless, AltCoinTrader, Luno and VALR have confirmed that they provide their clients with the option to access their transaction history for tax declaration purposes if need be.
If you are uncertain about the requirements of the Tax Act or need additional information about how it relates to your crypto-currency trading/ investments, contact Red Dot Now for professional accounting and financial advice.