Topic: Does Binance, Bittrex reports assets to tax authority? (Read 190 times)

Binance will report assets if authority demand from them. This is a recent example of our country where the federal investing agency have asked binance to submit the details of few wallets they suspect are involved in some sort of scams. A glimpse of this notice is attached here. Let me know if anyone is interested to see the full version of this notice.

It's funny that you in fact did contact Binance to ask for tax-related information. Do you think the person on the other end of the line would know? For all we know, that person is simply working in a BPO company who doesn't have any direct relationship with Binance. And if you indeed made contact with a Binance staff, do you think he/she knows tax-related information of the company? And if he/she knows, do you think he/she will readily provide the details to anybody asking for it?

Just keep in mind, once you are using a centralized exchange like Binance and you had been using KYC verified account then you should be ready to pay tax. It's because if your government asks to provide data, then they are obliged to do so if they want to run business in your country. It fully depends on tax authorities of your country whether they will ask for data or not. Like centralized exchange require KYC nowadays to withdraw funds, they would provide data to legal authority as well.

It depends on the type of exchange you use and I think that only applies to decentralized exchanges. You are now using binance which operates under your country's regulation to trade btc, meaning your country only allows you to interact with global traders without changing  your residency status or place of business because you are using a service guaranteed by a local authority.

Any references I can read? Information generally says that each country has its own google tax liability records, including mine.


It also depends on how you agree to take care of taxation (based on a legal agreement). It doesn't matter who the beneficiary is, if that state can allow you to fully tax the company then you may be exempt from personal taxes as a beneficiary.

When we say that crypto should be legalized worldwide, this implies that it will be brought under the tax authority. There is no way any government will legalize bitcoin without taxing it. Since, we know one day bitcoin will be adopted everywhere, which means that everyone will be paying taxes on gains in bitcoin. So even if exchanges don't report our assets to tax authority, they will start doing soon. We need to be prepared for this.

Things can change very swiftly, as we saw with Binance’s policy on KYC last year. It takes a bit of coordinated regulation and pressure and hey presto! Something that was not taking place becomes mandatory.

Spain made it mandatory last year for Exchanges (VASPs in general) to provide the tax office with details data on crypto tenancy and TXs. Although this is delimited to those businesses running there, it is something that came kind of overnight (so as to say).

Binance is eager to comply with regulations, and what keeps them (and others) from reporting to taxation offices is that there doesn’t seems to be a coordinated push for this to happen through regulation. They do, notwithstanding, quickly embrace changes to comply with FAFT to at least cover the easy cases of the Travel Rule, so really one should expect anything to happen at some point in time (and who knows if even retrospectively).

They do not report in Brazil . You  can check here:

https://livecoins.com.br/binance-nao-reporta-transacoes-de-brasileiros-a-receita-federal-diz-gerente-no-pais/

However   just like mk4 said, I don't trust them. What if they report everything back from 5 years ago? They are a company,  and they have obligations with tax authorities. They will do what they are forced to.

I paid some taxes few months ago, even selling in binance. I prefer to lose some money than to have a big headache

exchanges that handle fiat will and should be obligated to report the fiat value of their customers if more then $£E10k is moved, as those exchanges are money service businesses. not retailers.

however. the exchanges that do not touch fiat and only offer 'swaps' from one altcoin to another.. never touching fiat. then the laws are less clear and depend on how a country deems crypto.

just because an exchange plays with both fiat and bitcoin. does not mean the bitcoin half obsolves the exchange of its fiat laws

Is this true? I doubt your argument. Maybe I need a strengthening article to convince you of your statement. This is because some time ago I read if binance left singapore because of complicated administration. Therefore, Binance did not renew for a permit in 2022. See one of the articles here. It looks like they will have to submit to the rules of each country including the payment of its taxes, otherwise it is possible that they will soon be banned binance. This is in my country has been blocked for not complying with exchange provisions in my country.

Maybe, maybe not. I haven't heard of news concerning reporting to tax authorities as of yet. But like I said, if you want to be very sure, just assume that they will someday. It's the only way to protect yourself. Not to mention that they might already be doing this behind the scenes.

always assume that they will at some point report.
always assume even if they do not. THEIR bank (you deposit fiat into them/withdraw fiat out from them could)
always assume even if they do not. YOUR bank (you send fiat from/receive fiat to could)

assume all your fiat income and fiat outgoings is monitored.
assume all value that touches your 'accounts' registered in your real life name is monitored

.. as for tax liability.
if you were to think that an exchange is reporting. they can only report on the info they have,
for instance if you hoarded coins since 2012 at $6 a coin.. and then deposited into an exchange in 2022. and sold same day for $50k

all an exchange can do is report they received a asset valued at $50k today and sold it for $50k and you withdrew $50k in fiat today.
meaning its not treated as a 'gain' from the exchanges prospective ($50k in $50k out=0). as all they can report on is todays activity as its all they have seen. an exchange does not know about the 10 years of hoarding

but separately you would have to explain where you got that coin before the exchange.. to file YOUR tax/income forms to explain the possible 'gains' the tax office might want to know about, to explain the origins of the $50k in your bank.

this will require knowing the tax law/loopholes.
EG not a acquisition from 2012 at $6 meaning $49,994 'gain'(real event) but some other 'loophole' of tax free income method some anonymous time before 2022.
but this can also be risky to change the real event for a story that fits a loophole.
especially if you never 'mixed' your coins during 2012-2022 to pretend the 10 year hoard was not you, where you only received assets in 2022, line with your stories tax loophole

Binance and Bittrex will never report to your countries tax authorities. However, if you are living in a country where bitcoin is illegal and if ever, the government decide to crack down on you, they may ask binance to submit the deals about your transactions. Since you have done KYC with binance, binance can give all your transactions data when it is asked by the government.

What makes you skeptical about taxes? (sorry) Is your business illegal?
Just think about the worst risks (eg your company will definitely be reported to foreign authorities and your money will be confiscated without prior notification), so you can make your best decision.
If you're an honest and law-abiding person, it doesn't really matter if the exchange will end up reporting customer taxes in any country. And you should obey taxes since starting your business, not try to avoid it which is a sign of violation (crime).

Anyone knows if big exchanges report to authorities that ask for it? Any news?

As far as I know they currently don't. But even if they currently don't, who's to say that it will stay this way forever? Always remember that they have your data. It may be 1/2/3/5/10 years from now, but it's a safe assumption that one day they'll do; especially when authorities ask them to.

Seems like you're just throwing the question over and over again, what if I turn to ask: what's your effort so far in wanting to know about taxation issues after some advice has been given from other users?
Some of the threads you created:
https://bitcointalksearch.org/topic/where-does-binance-report-account-owners-5379307
https://bitcointalksearch.org/topic/where-should-i-incorporate-to-protect-my-assets-in-binance-5363127

And if they do so, to which countries they do?