- South African tax expert has warned non-tax paying crypto-traders.
- South African tax laws may have made it simple for SARS.
- Approach SARS first and declare crypto profits and losses in returns.
Thomas Lobban, a South African tax expert has warned non-tax paying crypto traders that they might undergo jail time if the South African Revenue Services (SARS) decides to assign tax offense charges against them. He said that this warning of jail time similarly applies to South African crypto traders that use offshore exchange platforms to trade or store their crypto assets.
Accordingly, Lobban’s warning follows reports earlier in the year which suggested that changes to South African tax laws may have made it simple for SARS to secure criminal convictions for tax offenses. These warnings will also follow reports in June that suggested that SARS has asked independent South African crypto platforms to enable it with information concerning its client base.
Moreover, he noted, “the lack of any meaningful guidance from SARS has not helped the situation either, leaving crypto investors with nothing more than their own best guesses about the correct tax treatment to be applied in each case”.
Furthermore, the tax expert also notes that while SARS is seemingly hesitant to enable guidance on the correct tax treatment. It is such mechanisms that revenue collector hopes to use when following South African crypto holders that trade on offshore exchanges.
Meanwhile, Lobban urged South African cryptocurrency holders and traders who are not sure of their tax obligations to approach SARS first and declare crypto profits and losses in their returns. So they remain in SARS good books to avoid sanctions.
For those who are outstanding historic liability, Lobban states there are avenues for correction without the threat of criminal liability.
