RECENT research shows that Australia currently boasts the highest rate of crypto ownership of 23 percent among developed nations surpassing both the UK and US. According to Coco Hou, CEO of Platinum Accounting Australia, the number of people seeking accountants with knowledge in crypto is increasing.
Unfortunately, the number of accountants with crypto expertise is still below where it needs to be. With such high ownership of crypto in Australia this figure is only going to increase and the ATO is developing more sophisticated systems and means to track ownership and transactions across centralised and decentralised exchanges and peer to peer," Hou said.
"Taxpayers need to understand their obligations and the tax implications of their actions, and they need informed advice from an accountant with an understanding of the implications of owning and transacting in crypto."
As cryptocurrency ownership grows in popularity in Australia, accountants need to be well-versed in crypto
Tax implications
"Cryptocurrencies are considered taxable assets in Australia. Accountants must understand how to report cryptocurrency transactions accurately to comply with the Australian Taxation Office (ATO) requirements," Hou said.
"Crypto transactions, including buying, selling and trading, can trigger capital gains events. Accountants need to calculate CGT and advise clients on potential tax liabilities.
"Advising clients on maintaining detailed records of all crypto transactions is essential for accurate tax reporting and audits."
Financial planning and advice
"Accountants can provide informed advice on the financial implications of investing in cryptocurrencies, including risk management and portfolio diversification. Understanding the impact of crypto investments on clients' long-term financial goals and retirement planning is crucial," Hou said.
Regulatory compliance
"Cryptocurrencies can pose risks related to money laundering and terrorism financing. Accountants must ensure compliance with relevant AML and CTF regulations," Hou said.
Regulatory updates
"Staying informed about the evolving regulatory landscape surrounding cryptocurrencies helps accountants guide clients in adhering to new laws and guidelines," Hou said.
Risk management
"Cryptocurrencies are known for their price volatility. Accountants need to help clients understand and manage the financial risks associated with crypto investments. Advising on best practices for securing digital assets, such as using reputable exchanges and wallets, is crucial for protecting clients' investments," Hou said.
Technology integration
"Integrating cryptocurrency tracking and reporting features into accounting software ensures accurate and efficient management of crypto transactions," Hou said.
"Understanding the underlying technology can help accountants identify potential applications and benefits for clients beyond just investments, such as smart contracts and decentralised finance (DeFi) opportunities."
Client demand
"As more clients invest in cryptocurrencies, they will seek knowledgeable professionals to help manage their finances and tax obligations," Hou said. "Accountants who are well-versed in crypto can attract and retain clients interested in digital assets, giving them a competitive advantage in the market."
Ethical considerations
"Advising clients on the ethical implications and legal responsibilities of crypto investments helps maintain trust and transparency. Providing balanced and informed advice on the potential benefits and risks of cryptocurrency investments aligns with the ethical standards of the accounting profession."
Hou said that as cryptocurrency adoption increases, accountants in Australia must be equipped with the knowledge and skills to navigate the complexities of crypto assets. This includes understanding tax implications, regulatory compliance, risk management and technological integration. By staying informed and proactive, accountants can provide valuable guidance to their clients, ensuring they make informed decisions and remain compliant with all relevant regulations.
About Platinum Accounting Australia
Platinum Accounting Australia is a leading national accounting firm that has been operating in Australia since 2008. With a national footprint, the business offers a broad range of services for individuals and businesses of all sizes including tax planning, accounting, advisory and bookkeeping. Platinum Accounting Australia also offers a highly popular and growing licensee program for bookkeepers and accountants to assist them to grow as part of a respected national network.
Visit: www.platinumaccg.com.au