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Edited version of private advice

Authorisation Number: 1051911881194

Date of advice: 26 October 2021

Ruling

Subject: Cryptocurrency trading business

Question

Are you carrying on a business of cryptocurrency trading?

Answer

Yes.

You are carrying on a business of cryptocurrency. Based on the facts and circumstances given below you meet the requirements of Taxation Ruling TR 97/11 - Am I carrying on a business.

This ruling applies for the following period:

Year ending 30 June XXXX

The scheme commences on:

1 July XXXX

Relevant facts and circumstances

•                    You started cryptocurrency mining in mid-XXXX.

•                    You bought XXXX cryptocurrency to buy mining related software but did not proceed with the purchase and so still have it.

•                    You usually do not buy but only mine cryptocurrencies.

•                    You mine XXX and XXX cryptocurrencies.

•                    Your intention is to pay off mining equipment purchases and make an income of $X per year.

•                    Turnover of Cryptocurrencies sold for financial years XXXX, XXXX, XXXX and XXXX was zero but for XXXX it was $X.

•                    You have a business plan, set budgets and targets and keep records of the cryptocurrency transactions of mining and selling.

•                    You do accounting for the cryptocurrency's transactions on a gross receipts' basis.

•                    For the financial years XXXX, XXXX and XXXX you invested $X, $X and $X respectively to buy graphics cards, tools, software, motherboard, power supplies etc.

•                    You have an office room and a separate mining room where most of the mining equipment is running.

•                    At the present time you intend to keep XXXX as you think it may increase in value.

•                    You sold some cryptocurrency in XXXX for a profit. Most of the cryptocurrency sold was mined in XXXX.

•                    You mined X, X, X (No mining) and X of X cryptocurrency in XXXX, XXXX, XXXX and XXXX financial years respectively.

•                    You have fulltime employment.

•                    You also run an IT busines.

Relevant legislative provisions

Taxation Ruling TR 97/11


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