The Norwegian Tax Administration is calling for voluntary reporting of cryptocurrency earnings ahead of the filing of tax returns deadline this month.
In a long post, the tax administration has revealed some “concerning” data regarding the matter, leading to their action.
It was noted that out of 235,000 people, only 4,700 reported in their tax returns in owning digital currencies or earning profit from transactions involving them in 2019. The tax administration, later on, stated that any cryptocurrency holder or trader who fails to declare their earnings in their tax return would pay additional taxes.
Mistakes about cryptocurrency
Cited by Blockchain.news, Norwegian Tax Authority senior adviser Marius Johansen said, “We think a lot of the gap is due to the fact that some crypto owners mistakenly assume that cryptocurrency is pre-filled in the tax return and have not thought that they are the ones who have to list this.”
He added, “Our experience is that most people will follow all laws and regulations, and we will help those who invest in crypto to do it right.”
It appears that the country’s tax authority is doing a lot of research, and according to Johansen, crypto transactions are more visible than many people think, and contrary to popular belief, users are not anonymous. The official also said that they have been following activities lately and have identified tens of thousands of people who failed to file accurate tax reports.
Strategizing to get crypto holders report their gains
There are now many countries that are employing strategies to make crypto holders report their capital gains.
The US Internal Revenue Service is at the forefront of a crackdown on cryptocurrency tax evasion, seeking aid from private tax contractors in the process.
Incentives for reporters are also created by government authorities, with the Norwegian Tax Administration saying that those who have incurred losses can have deductions if their claims are backed by the appropriate exchange.
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