Gains made from the acquisition and sale of cryptocurrencies, like any other currency, are not taxed. Companies that provide services related to cryptocurrency, on the other hand, are taxed on capital gains on a scale between 28 and 35 percent.
Canadian researcher Francois Vailancourt in 1989 examines the administrative costs associated with personal income taxes and two payroll taxes (CPP/QPP and UI). The costs include processing costs, administration and accommodation costs, capital expenses, and litigation costs. These costs represented roughly 1% of the gross revenues collected by these three tax sources. The paper does not show exactly what costs are incurred by capital gains tax.
Tax compliance costs are incurred when fulfilling the recording and filing requirements associated with paying a tax. These costs include such expenses as bookkeeping, reporting, calculating, and remitting tax payments. A study from 1992, which may be outdated due to technological advancements, found that American taxpayers who received capital gains income incurred higher compliance costs than those who did not. From a survey of 2,000 Minnesota households, the authors found that having capital gains increased the time individuals spent on paying taxes by 7.9 hours, increased the money they spent on professional tax assistance by about $21, and increased the total cost of compliance by $143 per taxpayer (not adjusted for inflation) per year.
In Albania, capital gains on the sale of stocks or shares are taxable at 15%. This tax rate also applies to capital gains made from transfers of ownership of real estate, both land or buildings. Individual income tax rate on dividends is 8%.
Australia collects capital gains tax only upon realized capital gains, except for certain provisions relating to deferred-interest debt such as zero-coupon bonds. The tax is not separate in its own right, but forms part of the income-tax system. The proceeds of an asset sold less its "cost base" (the original cost plus additions for cost price increases over time) are the capital gain. Discounts and other concessions apply to certain taxpayers in varying circumstances. Capital gains tax is collected from assets anywhere in the world, not only in Australia.
From 21 September 1999, after a report by Alan Reynolds, the 50% capital gains tax discount has been in place for individuals and for some trusts that acquired the asset after that time and that have held the asset for more than 12 months, however the tax is levied without any adjustment to the cost base for inflation. The amount left after applying the discount is added to the assessable income of the taxpayer for that financial year.
For individuals, the most significant exemption is the principal family home when not used for business purposes such as rental income or home-based business activity. The sale of personal residential property is normally exempt from capital gains tax, except for gains realized during any period in which the property was unused as a personal residence (for example, while leased to other tenants) or portions attributable to business use. Capital gains or losses as a general rule can be disregarded for CGT purposes when assets were acquired before 20 September 1985 (pre-CGT).
In Belarus, capital gains are included in the total income of the individual taxpayer. Income from the sale of one house, apartment, building, land plot, garage and a car parking space within 5 years and more is not taxable. However, income from the second sale and every subsequent sale of an immovable property of the same type within a five-year period is fully taxable.
Under the participation exemption, capital gains realised by a Belgian resident company on shares in a Belgian or foreign company are fully exempt from corporate income tax, provided that the dividends on the shares qualify for the participation exemption. For purposes of the participation exemption for capital gains the minimum participation test is not required.Unrealised capital gains on shares that are recognised in the financial statements (which recognition is not mandatory) are taxable. But a roll-over relief is granted if, and as long as, the gain is booked in a separate reserve account on the balance sheet and is not used for distribution or allocation of any kind.
If one's income is primarily derived from capital gains then it may not qualify for the 50% multiplier and will instead be taxed at the full income tax rate. CRA has a number of criteria to determine whether this will be the case.
For corporations as for individuals, 50% of realized capital gains are taxable. The net taxable capital gains (which can be calculated as 50% of total capital gains minus 50% of total capital losses) are subject to income tax at normal corporate tax rates. If more than 50% of a small business's income is derived from specified investment business activities (which include income from capital gains) they are not permitted to claim the small business deduction.
The applicable tax rate for capital gains in China depends upon the nature of the taxpayer (i.e. whether the taxpayer is a person or company) and whether the taxpayer is resident or non-resident for tax purposes. It should however be noted that, unlike common law tax systems, Chinese income tax legislation does not provide a distinction between income and capital. What is commonly referred to by taxpayers and practitioners as capital gain tax is actually within the income tax framework, rather than a separate regime.
The only tax circular specifically addressing the PRC income tax treatment of income derived by QFIIs from the holding and trading of Chinese securities is Guo Shui Han (2009) No.47 ("Circular 47") issued by the State Administration of Taxation ("SAT") on 23 January 2009. The circular addresses the withholding tax treatment of dividends and interest received by QFIIs from PRC resident companies, however, circular 47 is silent on the treatment of capital gains derived by QFIIs on the trading of A-shares. It is generally accepted that Circular 47 is intentionally silent on capital gains and a possible indication that SAT is considering, but still undecided on, whether to grant tax exemption or other concessionary treatment to capital gains derived by QFIIs. Nevertheless, it is noted that there have been cases where QFIIs withdraw capital from China after paying 10% withholding tax on gains derived through share trading over the years on a transaction-by-transaction basis. This uncertainty has caused significant problems for those investment managers investing in A-Shares. Guo Shui Han (2009) No. 698 ("Circular 698") was issued on 10 December 2009 addressing the PRC corporate income tax treatment on the transfer of PRC equity interest by non-PRC tax resident enterprises directly or indirectly, however has not resolved the uncertain tax position with regards A-Shares. With respect to Circular 698 itself, there are views that it is not consistent with the Enterprise Income Tax Law as well as double taxation treaties signed by the Chinese government. The validity of the Circular is controversial, especially in light of recent developments in the international arena, such as the TPG case in Australia and Vodafone case in India.
Capital gains in the Czech Republic are taxed as income for companies and individuals. The Czech income tax rate for an individual's income in 2010 is a flat 15% rate. Corporate tax in 2010 is 19%. Capital gains from the sale of shares by a company owning 10% or more is entitled to participation exemption under certain terms. For an individual, gain from the sale of a primary private dwelling, held for at least 3 years, is tax exempt. Or, when not used as a main residence, if held for more than 5 years. Any capital gains realized on the disposal of securities up to annual gross sale amount of CZK 100,000 are tax exempt for the taxpayer.
Individuals' interest income from bank deposits and bonds, realized gains on property and other capital gains are taxed up to 59%, however, several exemptions occur, such as on selling one's principal private residence or on gains on selling bonds. Interest paid on loans is deductible, although in case the net capital income is negative, only approx. 33% tax credit applies.
There is no separate capital gains tax in Estonia. For residents of Estonia all capital gains are taxed the same as regular income, the rate of which currently stands at 20%. Resident natural persons that have investment account can realise capital gains on some classes of assets tax free until withdrawal of funds from the investment account. For resident legal persons (includes partnerships) no tax is payable for realising capital gain (or receiving any other type of income), but only on payment of dividends, payments from capital (exceeding contributions to capital) and payments not related to business. The income tax rate for resident legal persons is 20% (payment of 80 units of dividends triggers 20 units of tax due).
The capital gains tax in Finland is 30% on realized capital income and 34% if the realized capital income is over 30,000 euros. The capital gains tax in 2011 was 28% on realized capital income. Carryforward of realized losses is allowed for five years. However, capital gains from the sale of residential homes is tax-free after two years of residence, with certain limitations.
In general, Hong Kong has no capital gains tax. However, employees who receive shares or options as part of their remuneration are taxed at the normal Hong Kong income tax rate on the value of the shares or options at the end of any vesting period less any amount that the individual paid for the grant.
If part of the vesting period is spent outside Hong Kong, then the tax payable in Hong Kong is pro-rated based on the proportion of time spent working in Hong Kong. Hong Kong has very few double tax agreements and hence there is little relief available for double taxation. Therefore, it is possible (depending on the country of origin) for employees moving to Hong Kong to pay full income tax on vested shares in both their country of origin and in Hong Kong. Similarly, an employee leaving Hong Kong can incur double taxation on the unrealized capital gains of their vested shares. 2b1af7f3a8