The Israel Tax Authority (ITA) is targeting the traders and investors of cryptocurrency in a way to stem tax evasion for not disclosing the total earnings generated from the crypto investment and trading.
As per the reports of Calcalist, the tax authority is aiming the people who are not reporting the gains made from investments in virtual currency. Major steps have been taken like sending a notice through letters to the traders who are suspected for not revealing the earnings of their crypto investments.
Traders and Investors under Taxation
According to the financial daily, the traders used to evade taxes by not giving the detailed report of their foreign travels, there is clear evidence that the investors have not provided any valid documentation of how their trips have been managed so far. Adding to this, investors who have their multiple real estate lands are also been targeted. The reports say:
“The authority has also sent notice letters to Israelis whose activity raises suspicion of unreported earnings, such as those who travel abroad frequently without having the requisite funds on paper or those who own over three apartments…”
Taxation on Crypto Assets
Along with targeting the tax defaulters, the tax authorities of Israel have opened accounts for the users who have been suspected for not opening up their earnings made from trading in cryptocurrency. Eran Yaakov, the head of the Israel Tax Authority (ITA) said that the process of nabbing tax evaders will continue.
The leading crypto Bitcoin and other major cryptocurrencies have been classified as assets by the Israel Tax Authority (ITA). As per the tax authorities, there will be taxation on such assets as well.
Around a year ago, the Israel Tax Authority said that the leading crypto Bitcoin will come under the guidelines of Income Tax, as the cryptocurrencies are considered as assets; therefore, there will be tax imposition on them too. The income generated from the sale of cryptocurrencies will be classified as capital income and as per the fixed tax rates, the capital gains will be taxed accordingly.