Maximise Your Tax Benefits with Strategic Crypto Selling Before 30 June 2024

As bullish market conditions persist, many might be tempted to take profits, but it's essential to be aware of the tax implications of trading or swapping assets. Keeping organised records can help reduce the burden of compliance at the financial year's end, and setting aside funds for tax liabilities can prevent the need to liquidate assets unexpectedly.

With the financial year ending on 30 June 2024, it's crucial to take proactive steps to ensure a favourable tax position. Whether you already have a tax structure in place or not, consider adopting effective tax planning strategies before the deadline. Opportunities for a complimentary meeting are available to discuss these options.

Key Points on Tax and Strategic Selling:

• Selling crypto triggers a Capital Gains Tax (CGT) event, and it's important to plan to avoid significant taxes that could force the sale of other assets.
• Both selling crypto for fiat and swapping for other cryptocurrencies, including stablecoins, are taxable events.
• Profits from sales are taxable as capital gains, while losses can offset future gains.

Planning for Tax Obligations:

• When selling crypto for fiat, set aside funds based on your marginal tax rate to cover the estimated tax liability.
• For crypto-to-crypto transactions, which are taxed similarly, using a portfolio management tracker can help in budgeting for taxes.

Beyond Capital Gains:

• Income from passive sources and decentralised finance (DeFi) activities also has unique tax implications.
• Accurate record-keeping is vital for managing compliance costs and minimising tax burdens.

Remember, for personalised and expert advice, especially in complex situations involving DeFi activities, contact R J Sanderson & Associates. Their team of experts is ready to help you navigate the nuances of crypto taxation and ensure your investments are as tax-efficient as possible.

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