Cryptocurrency Income Declared by Russians in Tax Returns

While in many countries, there is no clarity on the income tax on cryptocurrency income, Russia it seems to be at the forefront when it comes to filing returns on the income which is made with the help of cryptocurrencies. This is one of the main reasons why individuals are actually declaring their income which they have made from cryptocurrencies.

Many of these individuals are declaring income on cryptocurrencies for the 1^sttime. However, with the rules and regulations revolving around income on cryptocurrencies being, the confusion is pretty less.

Also, the Russians have to pay tax before April 30. This is the reason why they are working in order to disclose their cryptocurrency income as well.

According to a later dated June 6, by the Finance Ministry of Russia to the regional tax offices, there are no separate rules for dealing with cryptocurrency income. They will be dealt with in the same way just like any other income. As a result, the returns can be filed quite easily.

Some questions persist:

Even though up until now, there are no separate rules but in the very near future, there might be subject taxation rules for the cryptocurrencies. That is why taxpayers are trying to figure out what will be the special rules. Until and unless, the special rules are not unveiled, the consumers will not actually know how much tax they have to pay when they are following the separate tax laws.

Also, there is no proper definition of cryptocurrencies either. This is actually adding to the confusion. The chairman of the parliamentary financial markets committee, Anatoliy Aksakov recently stated that the concept of digital money or digital currency will not be recognized legally in some period of time. It will be replaced with the concept of digital rights. The Russian Prime Minister has also made similar comments in the recent past. As a result, the legal status of the cryptocurrency will change. When the legal status of the cryptocurrency changes, the taxation on cryptocurrency will change as well.

With that being said, it remains to be seen in the future what is the level of taxation pertaining to cryptocurrency. For now, however, the Russians are using the normal tax infrastructure in order to pay the income tax on the cryptocurrency earnings as well. In the future, whenever the legal status of cryptocurrency changes, the taxation structure will also change and it is only at that point that individuals will realize how they have to file for tax returns on the income made from cryptocurrencies.