Topic: Whether the money from the proceeds in bitcoin will be subject to income tax? (Read 1067 times)

It is now possible that bitcoin legality still has not received legal recognition for bitcoin as the world's digital currency, but this is certainly not a significant obstacle to bitcoin development, even some countries have successfully announced the legality of bitcoin as a legal digital eye in it.
If the legality of bitcoin is not legal, then there is no regulation from the government that binds income tax from bitcoin, but it is definitely back to rules applicable in that country, because each country must have different rules regarding its tax policy.

That's their way of getting around the fact that Bitcoin is not legally recognized as currency. So they call it an asset which, in essence, is what currency becomes when banked.

You know, tax isn't necessarily an evil thing to avoid. If you're making income, it doesn't matter if you're selling cookies, writing freelance or trading currency or crypto. Do the right thing and file your taxes as required by your government. If you're not sure, ask. In most countries, they would probably not even bother once you tell them - get official acknowledgment of this. Then you can rest easy without worrying.

I am paying my income from bitcoin as short term gain and gain through doing services, so i use to pay tax as per it and on whole it comes to some percentage what i wanted to be least as i am legally using this service.

This is a bane issue that will continue to reoccur as a major concern for the legalization of bitcoin and that is how will government tax it. How will government investigate the claims of tax payers if they only have to rely on voluntary compliance. But I feel when this is finally implemented, the rate will be minimal in other to encourage people to do it willingly because without that, a lot of tax evasion will be very high and the costs of curbing that will be too high on the part of government.

They say that there are only sure things in this world...the other one is death while the next is tax. Nobody can avoid paying taxes while we are still alive. While we may not know it every time we are consuming a product we are also paying a form of tax. And I think you already aware of this fact.

Right now, after the big boom of Bitcoin and other digital currencies, governments are noticing of the money involved and so they devised ways to also produce revenues out of the thousands of transactions happening daily. USA right now is expecting you to declare an income when you convert your Bitcoin to the fiat money. I am not really sure how much you have to pay on that.

Here in my country, the tax is paid by the Bitcoin service providers which we know is passed unto us. We are not yet strictly required to declare income gains so we can do it voluntarily if we want to but there is no harsh rule yet...that is for now.

Maybe every country certainly has a different policy about tax rules, as well as with bitcoin taxes.
If you do not mind can you explain the prevailing tax system in your country?
This may be useful to all of us as knowledge.

Proceeds in bitcoin as your bitcoin income in case you were employed by a company that pays in bitcoin? If you're working for bitcoin and your employer goes by the book, you will also have to declare income, there's no other way. If you don't they will know from your employer and it's only a matter of time before you're asked to pay taxces with interest.

If you have unofficial gains, like you got some coins for coding something for someone, nobody will be able to prove you own the address until you decide to exchange it for fiat and send it to your bank account. I'm not declaring any coins that I own, it's my choice, but if I ever decide to sell everything I'll unfortunately have to. I don't like it and I don't agree with the current tax system of my country, but there's not much I can do.

Countries have different laws and views regarding cryptocurrencies. Some are treating it just like assets and you have to pay a certain percentage out of the gains you made. This is akin to owning some stocks or any investment certificates. Some countries have banned Bitcoin outright but it never stopped some of their people to own Bitcoin because transactions online can now be easily hidden from corrupt government anyway...so they are not paying any tax at all.

While it can be a burden paying those taxes in countries where laws are strictly implemented and where agencies are powerfully monitoring their citizens' transactions then we would have no choice but to do according to the guidelines set by the governmental authorities otherwise we can be facing tax evasion and similar cases.

Otherwise, if you already have a good hoard of Bitcoin, I am advising you to migrate to a country where laws on Bitcoin is not yet formulated and the government is still confused on how to treat crytocurrencies. I belong to a country where most Bitcoiners are not yet paying direct taxes but we don't know what can happen in the future. What I understand is that Bitcoin service providers are the ones paying their transaction and income taxes to the government as they are recognized as money exchangers.

It depends upon the taxation rule of country to country according to the GST , but if Thier no no rule for the GST like system in any country then general rule will be applicable .
For example in my country if your income is more than 4555$ then you will be needed to pay the tax at 2% and if 10000$ then 3% and so on.
So finally when you will make earnings in the Bitcoin then you need to cash out in the bank and you need to declare what you made in the Bitcoin or in any online business  .
But still beside the normal taxation  the governments are looking for the taxation in different way for such things , like to make tax for every small amount earning .
( In my country the new GST system will made and applicable to all the people in my country and rule will be start from the 1 August  , so I will tell about this here , after launching. Or will start a new thread for such things    )

Yes exactly it will come under TDS I have seen this on my TDS report .so I decided to not convert bitcoin to money I will keep this as asset for my future.

Depending on your country and how it does view bitcoins (without selling them and keeping as they are), if my understanding is right USA for example trade bitcoins as a commodity and not direct money,
This kind of question is better to asked to a lawyer, considering this is a difficult legal topic for those living in US and Europe, where tax evasion is a serious crime.

Now more countries like China and Russia are coming forward to regulate bitcoin.If it occurs,surely bitcoin earnings would be taxed.But the percentage of taxes may differ for each and every country as per their laws.But,it cannot be avoided in future.

back in 2014 IRS released a guidance on how they will treat bitcoin and other digital currencies, and they consider it as capital assets and therefore subject to capital gains taxes.[1]
and no matter in which country you live in you should consult some professionals about this matter.

[1] https://en.bitcoin.it/wiki/Tax_compliance#U.S.

Of course this will be a scary thing for bitcoin users, they will lose some of the money they have.
But positively then we can regulate the user, so it looks who has bitcoin. This can help when bitcoin is used for crime.

If it is true income from bitcoin will be subject to income tax, about what percentage and what is your response?