What is a cryptocurrency?

Cryptocurrency is a digital currency in which transactions are verified and records maintained by a decentralized system using cryptography, rather than by a centralized authority.

In South Africa cryptocurrency is viewed as an asset of an 'intangible nature' as opposed to currency or property. Crypto thus attracts both Capital Gains Tax and Income Tax. It is unfortunately not clear whether crypto should be taxed as income or as capital.

How does SARS track cryptocurrency?

Legislatively, SARS is granted a wide range of collection powers in terms of the Income Tax Act, including a requirement for third-party service providers to submit financial data. Enforcement and audit processes are confidential and not shared with members of the public.

How does SARS treat cryptocurrency?

SARS has made it clear that crypto transactions will be taxed according to the existing South African tax laws. This means that crypto profits will either be taxed based on capital gains tax principals, or as revenue transactions (i.e as normal income, like your salary or freelance income)

Do I have to pay taxes on my cryptocurrency?

Yes, your Bitcoin, Ethereum, and other cryptocurrencies are taxable.