THE ROLE OF INTERNATIONAL TAX SYSTEMS IN THE TAXATION OF CRYPTOCURRENCIES

Cryptocurrency taxation is a set of taxes on cryptocurrencies in a particular jurisdiction that are levied on various transactions conducted by legal entities and individuals with cryptocurrencies. Questions about the legal nature of digital currency and transactions are handled differently in each country. Various jurisdictions treat digital currency as a means of payment or, more broadly, as a medium of exchange. The lack of formal certainty in this area regarding the general legal status of cryptocurrencies entails extensive discussions on more specific issues regarding the need for licensing the activities of exchanges, taxation of cryptocurrencies, and so on. The situation is constantly changing. Ordinary users often fear that if they encounter problems when working with cryptocurrency exchanges or ICOs, they may not receive help from the state and support from the law. Miners and traders also remain at risk, worried about the uncertainty of the cryptocurrency tax on income generation. It should be remembered here that mining, as a type of activity, requires an initial investment and the regular purchase of new computer components, and is currently not protected by law. Trading crypto assets is similar in nature to trading stocks and securities. The approach to be taken in determining whether a transaction is taking place or not is also similar, and guidance can be drawn from existing jurisprudence in stock and securities trading. The capital gains tax for cryptocurrencies works the same as for other assets: if a loss is incurred in transactions, you can declare a loss and save on fiscal deductions. There are two different types of capital gains taxes: long term and short term. Long term means you held the currency for more than a year before selling or trading it, short term applies to less than a year. Rates vary by country and taxpayer category