JOHANNESBURG - South Africa’s tax authority is tightening its grip on the fast-growing cryptocurrency market.
The South African Revenue Service (SARS) has published a draft guide outlining how cryptocurrency transactions should be taxed.
The draft signals tougher oversight for millions of South Africans investing in digital assets.
Tertius Troost, Associate Director at RSM, said that this is the first time in almost eight years that SARS has provided detailed guidance on crypto assets.
"Previously, the only indication from SARS was that the normal tax rules would apply to crypto asset transactions.
“This draft provides much-needed clarity, particularly in a market that has been characterised by uncertainty. We’ve also seen conflicting court judgments involving the South African Reserve Bank, which has added to that uncertainty," he said.
Troost added that it’s important to remember that this is only a draft guide and reflects SARS’ interpretation.
"It is not legally binding on taxpayers, but it does provide a strong indication of how SARS is likely to assess crypto transactions,” Troost said.