How is Bitcoin taxed?/ is bitcoin legal.
In many jurisdictions, Bitcoin and other Cryptocurrencies are still a legal grey area as it’s becoming more and more popular, law enforcement agencies, tax authorities and legal regulators all over the world are trying to understand the concept of cryptocurrency and where exactly does it fit in existing regulations and legal frameworks.
The legal status of Bitcoin depends on where you are in the world, and what you’re doing with it. Here’s our guide on legal issues concerning Bitcoin.
Bitcoin is not getting a legal tender status in most countries, but some countries’ tax authorities have acknowledged its significance and proposed specific regulations. So many countries observing bitcoin as Bitcoin is a relatively new currency, the regulations frameworks governing its taxation significantly differ depending on the country.
The United States Tax Service Treats Bitcoin As A Property
For example, the United States tax service treats Bitcoin and all other digital currencies as a property rather than a currency. Every taxpayer selling goods and services for Bitcoins has to include the value of the received Bitcoins in their annual tax returns. Miners are also subject to U.S. taxation, but only if the mining proves to be successful.
According to the European countries, Bitcoin is a currency, not a property. Bitcoin can still be subject to other taxes. The United Kingdom tax authorities treat Bitcoin as a foreign currency, with every Bitcoin-related case considered based on its own individual facts and circumstances.
As of July 2017, the trade of Bitcoins is exempt from consumption tax in Japan, where it’s officially recognized as a payment method. So, as Bitcoin is a new currency, the regulatory frameworks governing its taxation significantly differ depending on the country. In many countries, there are no specific laws or regulations regarding cryptocurrency.
In many countries, the authorities are still struggling to understand Bitcoin, It seems only natural for governing authorities to be worried about a financial community that can’t be fully controlled.
The countries where Bitcoin and other cryptocurrencies are banned are Bangladesh, Bolivia, Ecuador, Kyrgyzstan, and Vietnam. China and Russia are about to join those jurisdictions in due time.
Your opportunities depend on the role
Buying goods is completely legal in some countries. You can buy products or services online through Bitcoin and other Cryptocurrencies.
List with some online stores accepting Bitcoin as a payment for their products:
- StarJets International
- Reeds Jewelers
Investing In Bitcoin
Investing in Bitcoin is also within the legal territory. Many regulated exchanges have to comply with Anti-Money Laundering and inside trading. Those who want to trade and invest in Bitcoin have to verify their ID and connect an existing bank account. we strongly recommended read the term and conditions of the Exchange.
As the world moves to regulate the cryptocurrency
Countries Where Bitcoin is Legal tender:
Countries Where Bitcoin is illegal tender: