Bitcoin airline payments

[moa999]

/s means sacrcasm fyi.

Mind you if I'd bought in at the start (now up 1000x) I could afford that bridge

 

[drron]

Though you could travel to Zimbabwe where there is a 50% added value for your bitcoin.
Apparently they don't trust anyone trying to do such business via the internet alone.

 

[Jamesaurus]

So what's the implication if you purchase something as a personal transaction for greater than $10k?

Well rather than having to cash out in aud and pay capital gains tax, you could make purchases with it and pay zero

While these digital-tulip bulbs continue to grow this can be a useful strategy to lock in some gains.

 

[Daver6]

Well rather than having to cash out in aud and pay capital gains tax, you could make purchases with it and pay zero

That's exactly what the ATO is saying for transactions under $10k as I understood it. What I don't understand is why is it different for over $10k and what is the implication?

 

[Jamesaurus]

That's exactly what the ATO is saying for transactions under $10k as I understood it. What I don't understand is why is it different for over $10k and what is the implication?

here is the legislation stating that BTC is considered an asset for capital gains if >$10k
http://law.ato.gov.au/atolaw/view.htm?DocID=TXD/TD201426/NAT/ATO/00001

But... if say you made an actual purchase for >10 e.g. a RTW fare for 2BTC i'm unsure if the ATO could then chase this up and ask for a cut retroactively.... thoughts?

 

[Daver6]

Does the same apply for other foreign currencies greater than $10k AUD?

 

[Jamesaurus]

Does the same apply for other foreign currencies greater than $10k AUD?

Well if you buy an overseas asset, say US shares and make aud 10k equivalent, then as I understand it you'd have to declare that in your tax return and pay capital gains once you transferred your USD back to AUD

 

[moa999]

If you make a $ from offshore shares you have to declare it.

But much harder for the ATO to track as it doesn't have a TFN, although data sharing is pretty good

 

[cambriamarsh]

/s means sacrcasm fyi.

Mind you if I'd bought in at the start (now up 1000x) I could afford that bridge

My apologies, wondered what that was. Yes, as long as you're aware it's a bubble and don't put too much into it there may be a dollar to be made, but it's gambling not investing.

 

[Daver6]

Well if you buy an overseas asset, say US shares and make aud 10k equivalent, then as I understand it you'd have to declare that in your tax return and pay capital gains once you transferred your USD back to AUD

I'm talking about holding foreign currency, not an asset.

 

[Jamesaurus]

I'm talking about holding foreign currency, not an asset.

you wouldnt have to declare unless u sell for a profit (which is a cgt event)

 

[Daver6]

you wouldnt have to declare unless u sell for a profit (which is a cgt event)

So if you spend it on a service (ie expensive holiday), there is no profit. Why is a crypto-currency seemingly treated differently then for over $10k?

 

[Jamesaurus]

So if you spend it on a service (ie expensive holiday), there is no profit. Why is a crypto-currency seemingly treated differently then for over $10k?

You raise a good point. There is no advice from the ATO on how they treat money spent >10k purchases either so I'm unsure how they plan to ask for a retroactive cut of goods & services bought in crypto.