Australian Court Says Bitcoin Should Be Treated as Money

Bitcoin Ruling May Trigger Massive Tax Refund in Australia

Australia Court Classifies Bitcoin as Money, May Trigger $640M in Tax Refunds

The taxation of Bitcoin in Australia may be altered by a significant court ruling. For those who have already paid taxes on BTC profits, a judge's decision that BTC should be regarded as money rather than an asset could result in substantial fee refunds. A case involving William Wheatley, a police officer, led to this ruling. He was charged with stealing 81.6 Bitcoins back in 2019. The stolen BTC was valued at approximately $492,000. It would be worth more than $13 million now.

BTC should be viewed as cash, much like Australia dollars, 

An Australian Judge rules it should be treated as money, not a taxable asset. According to the case's judge, Victoria's Michael O'Connell. This differs from the way it has been handled for many years, which has been considered an asset or property similar to stocks, gold, or foreign currency. As stated from the judge, Bitcoin should be handled in legal and tax affairs as though it were money. 

For Australia investors, this decision might be revolutionary. 

The Australian Taxation Office (ATO) has regarded BTC and other cryptocurrencies as assets for the last 10 years. This implies that a person must pay capital gains tax (CGT) on any profits they make from trading or selling Bitcoin.

However, it might no longer be subject to CGT fee if it is formally recognised as money rather than an asset. Many Australians may receive refunds for the taxes they have already paid on their transactions as a result of this.  

Tax refunds could reach $640 million

Adrian Cartland, a tax attorney, told the Australia's Financial Review that the ruling might result in $640 million in tax returns. According to him, “the decision fundamentally alters how the ATO has managed bitcoin taxes for the previous ten years. In reality, the total amount of the return could reach $1 billion if additional people come forward and the decision is implemented widely.

The ATO hasn't verified any refund figures, though. Since the legal procedure is still ongoing and the ruling may be appealed in higher courts, it stated that there are currently no definitive estimates.

Imagine zero taxes on Bitcoin

If the decision is upheld, it may significantly affect how fees are treated for other digital currencies in addition to Bitcoin. Additionally, it might compel politicians and the ATO to reconsider and perhaps revise the current crypto laws.

Australian cryptocurrency investors are currently keeping a careful eye on things. They may be able to receive a refund of some of their previous fees payments and save a significant amount of money on future taxes if BTC is formally recognised as cash.