Bitcoin Forum
March 28, 2024, 09:19:17 PM *
News: Latest Bitcoin Core release: 26.0 [Torrent]
 
   Home   Help Search Login Register More  
Pages: « 1 [2] 3 4 5 6 7 8 9 10 11 12 13 14 15 16 »  All
  Print  
Author Topic: Why are people so eager to pay tax?  (Read 13573 times)
Jobe7
Full Member
***
Offline Offline

Activity: 238
Merit: 100


Now they are thinking what to do with me


View Profile
April 21, 2013, 12:55:17 PM
 #21

I don't know how it is everywhere else (pretty sure its the same in the US, but don't quote me).

In the UK, you do NOT pay Bitcoin tax .. no matter what anyone says, it simply does NOT EXIST!

OK, that said, I do get a little  Roll Eyes when people are like "amagad pay tax pay tax!"

What you pay tax on is the amount you change into FIAT. It is simply NOT considered capital gain, or bloomin' anything else.. might as well start trying to declare World of Warcraft gold or Eve online currency (can't remember what that's called) as your 'capital gains' ..

HMRC simply does not recognize Bitcoin as taxable .. yet.

Anyway .. that said .. if you're a sole trader, nps, keep changing your btc into fiat until you hit the 'tax cap' (working in expenditure), then declare and pay your taxes, not saying anything, but ye, this part is easily 'fiddled' (legally!).

If you're a private or public company, then yes, you'll run into 'messiness' if you try to 'fiddle' a lot and pretend you're not making any profit, and this is highly NOT advisable.

It IS advisable to change some to fiat in the terms of 'profit', declare that, and personally I'd make a point of explaining btc and that I was keeping some as btc and re-spending it as btc, encouraging hmrc to think about taxing it.


It will come, eventually, and it will be a good thing.

edit: Don't get me wrong, I'd much prefer to pick and choose who/where/what I pay my 'taxes' towards. But obviously quite a few potential and current businesses don't want to get closed or locked up for tax avoidance. And it's also the same argument as those that was Cannabis legalised as a 'free for all', no taxes whatsoever.

Taxes CAN be a good thing, if they're used appropriately. I'd be happy for more nurses/doctors/hospitals/better education/better public services, etc, etc

But ye.. current governments abuse the system very badly (surprise surprise...)
1711660757
Hero Member
*
Offline Offline

Posts: 1711660757

View Profile Personal Message (Offline)

Ignore
1711660757
Reply with quote  #2

1711660757
Report to moderator
Every time a block is mined, a certain amount of BTC (called the subsidy) is created out of thin air and given to the miner. The subsidy halves every four years and will reach 0 in about 130 years.
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
1711660757
Hero Member
*
Offline Offline

Posts: 1711660757

View Profile Personal Message (Offline)

Ignore
1711660757
Reply with quote  #2

1711660757
Report to moderator
roy7
Sr. Member
****
Offline Offline

Activity: 434
Merit: 250


View Profile
April 21, 2013, 01:05:32 PM
 #22

What you pay tax on is the amount you change into FIAT. It is simply NOT considered capital gain, or bloomin' anything else.. might as well start trying to declare World of Warcraft gold or Eve online currency (can't remember what that's called) as your 'capital gains' ..

I can only speak to the USA, but converting it into something of value other than USD should still be a taxable event I believe. It'd fall under barter most likely:

http://www.irs.gov/taxtopics/tc420.html

That is, I pay you (as a barter since bitcoin isn't an actual legal tender, yet?) X bitcoins for a car worth $15,000 USD. That places my mined bitcoins at a value of $15,000 USD with a cost basis of zero, for a $15,000 realized gain.
RenegadeMind (OP)
Copper Member
Hero Member
*****
Offline Offline

Activity: 1380
Merit: 504


THINK IT, BUILD IT, PLAY IT! --- XAYA


View Profile WWW
April 21, 2013, 01:41:07 PM
 #23

So someone who acknowledges that their taxes pay for roads, schools, the fire and police departments, hospitals, just to name several, and hence feels that freeloading by avoiding taxes is a dick move, is "brainwashed" or "stupid".

Roads > Paid for with gasoline/petrol taxes
Schools > Paid for by property taxes

Not sure about fire & police departments.

But I'm not so sure that I like my tax dollars funding unlimited wars, bank bailouts, corporate bailouts, forced sterilizations, human experimentation on unwilling/unknowing subjects, and a truckload of other outright immoral and evil things.

No... I'd prefer not to help fund wholesale murder and corruption.

If you really want to fund murder, why not just do it yourself. Why do you need a middle man?


And as for the "you don't have to" argument because governments don't know what bitcoin is yet - it's a thing you got at price X, and you sold at price Y.  So at a minimum, if you convert your profits (Y-X) to fiat you have some kind of tax bill.  The other side - spending bitcoins bought (or mined) at X for something at Y (Y > X) - is something that governments will have to decide how to classify, but don't think that just because they haven't issued a ruling yet means your profits are free.


So, Joe decides to go on a long deserved holiday to Lovelyland, and purchases $2,000 Lovely dollars for $2,000 of his country's fiat dollar.

He returns from his Lovelyland holiday and goes to sell his remaining Lovely dollars, $1,000 as things were cheap and he was frugal. Much to Joe's suprise, oil, gas, diamonds, and the cure for cancer were all discovered in Lovelyland while he was away, and the Lovely dollar rose nicely. Joe end up recieving $2,000 of his country's fiat dollars for his $1,000 Lovely dollars.

1) Does Joe have to pay capital gains tax?
2) How is bitcoin different? (For those that purchase and are not professional traders.)


I hope your house burns down, or you die in the street after being hit by a car, or some other fate


It's funny how often those that preach collectivist principles always end up calling for someone to die.


RenegadeMind, noone is "eager" to pay tax. But some of us to choose to obey the laws of the country we live in. The forum has plenty of people whose moral code appears to be "it is okay to break the law if I'm unlikely to get caught".

It seems like there are a lot of Americans in this forum, and a lot eager to cough up. I happen to have an advantage given my particular situation in that I'm not under any obligation in the country where I live to pay that particular tax. Smiley

Now, if you have money outside of your country of residence, it really isn't any business of the government of your country as it is outside of their sovereign territory and outside of their jurisdiction.

(Assuming you live in none of these places...)

You can go to Colorado and smoke pot.

You can go to Amsterdam for "intimate physical encounters".

You can go to Texas and own and shoot guns.

You can go to Vietnam and insult the king of Thailand. (God forbid you ever go to Thailand afterwards...)

But you're not going to face criminal charges where you live for what you do outside of that territory.

Why is bitcoin somehow magically different?

Large corporations and trusts do business in other countries simply to get around tax laws in their own countries?

Why do corporations get to avoid tax, but individuals don't?

*IF* you do your bitcoin activities where you live, then sure - you're doing it there.

If you are doing your bitcoin activities outside of where you live, then it's none of their business.

Does where you live necessitate that your local "authorities" somehow have absolute purveyance over everything you do and every aspect of your life, even outside of their jurisdiction?

I don't think so. Just because you live somewhere doesn't necessitate some kind of lien on your soul.

If you want to go whoring in Nevada, that's your business. It's legal there.



Perhaps a better question would be:

Why do people do bitcoin activity in jurisdictions where they will be liable for tax?


Here's something entertaining to think about as a minor distraction. Cheesy


(A)social
Hero Member
*****
Offline Offline

Activity: 644
Merit: 504


View Profile WWW
April 21, 2013, 02:04:31 PM
 #24

I hope your house burns down, or you die in the street after being hit by a car, or some other fate
It's funny how often those that preach collectivist principles always end up calling for someone to die.

Isn't it?  Grin

BTC: 1ASociaLbBZzBUR8hSw8CryajncADsR1m6 - Bitmessage: BM-orfFdAgAmtnBokTivq3vj1RtSVtXbrftM
OpenBazaar Store: https://openbazaar.com/store/QmeCThm8d5zcat7BjGw4SQeovaC5diF9s4b2yTSHWdpzmb
Luno
Sr. Member
****
Offline Offline

Activity: 504
Merit: 250


View Profile
April 21, 2013, 02:11:17 PM
 #25

This is a funny thread: You hate government control and taxes, you believe that officials are corrupt, you are a libertarian, so you agree to the notion of government, unless you are an ancap ideologist, so it's ok to be corrupt yourself? You like infrastructure, but you don't have to pay because you are smart enough to evade tax?

How is judging others as criminals an argument for breaking the law yourself?
elebit
Sr. Member
****
Offline Offline

Activity: 441
Merit: 250


View Profile
April 21, 2013, 02:27:06 PM
 #26

Isn't that a part of the attraction of bitcoin? You can AVOID tax? And as for "realized gains", why not just sell your bitcoins offline to some person willing to show up at a coffee shop and pay cash?

No, the the attraction of Bitcoins is fast global payments an order of magnitude cheaper than anything else.

Of course you should pay taxes if your investment pays off. It's income just like anything else and that's what makes society work. If I had lived outside society I would statistically not have had the opportunity to learn about this stuff, let alone own a computer.

What you say about cash transactions is true for all foreign exchange speculation. Sure you can trade USD and JPY by meeting random people on the street from the classified section and exchange cash. Then all your speculation would be outside taxation. But if that seems like a worthwhile endevour for you, you are investing way too little!
kokjo
Legendary
*
Offline Offline

Activity: 1050
Merit: 1000

You are WRONG!


View Profile
April 21, 2013, 02:31:04 PM
 #27

Isn't that a part of the attraction of bitcoin? You can AVOID tax? And as for "realized gains", why not just sell your bitcoins offline to some person willing to show up at a coffee shop and pay cash?
No, the the attraction of Bitcoins is fast global payments an order of magnitude cheaper than anything else.
+1 truer words have never been spoken.

"The whole problem with the world is that fools and fanatics are always so certain of themselves and wiser people so full of doubts." -Bertrand Russell
Jobe7
Full Member
***
Offline Offline

Activity: 238
Merit: 100


Now they are thinking what to do with me


View Profile
April 21, 2013, 02:37:20 PM
 #28

Need to add (concerning UK), though you'd not pay taxes on 'bitcoin' until you changed it into fiat, you'd still be paying taxes on whatever commodity you were trading in.

As an exchange the rules are different, don't ask me on that.
Jobe7
Full Member
***
Offline Offline

Activity: 238
Merit: 100


Now they are thinking what to do with me


View Profile
April 21, 2013, 02:58:07 PM
 #29

What you pay tax on is the amount you change into FIAT. It is simply NOT considered capital gain, or bloomin' anything else.. might as well start trying to declare World of Warcraft gold or Eve online currency (can't remember what that's called) as your 'capital gains' ..

I can only speak to the USA, but converting it into something of value other than USD should still be a taxable event I believe. It'd fall under barter most likely:

http://www.irs.gov/taxtopics/tc420.html

That is, I pay you (as a barter since bitcoin isn't an actual legal tender, yet?) X bitcoins for a car worth $15,000 USD. That places my mined bitcoins at a value of $15,000 USD with a cost basis of zero, for a $15,000 realized gain.

OK, if you had btc of $15,000 USD value (lets use a random number, 200 btc), then brought a car with that amount. You now have a car, would you still have to pay tax on the btc that you no longer have?

On the car, yes, same as in the UK. But you don't pay tax on stuff (money/btc) you don't have.

So, in the US you'd have to declare your btc, pay tax on that as if it was $15,000? (how do you propose to pay that tax in btc exactly? Does the IRS have a Bitcoin wallet now that I'm unaware of?).

deadweasel
Sr. Member
****
Offline Offline

Activity: 364
Merit: 250



View Profile
April 21, 2013, 03:02:04 PM
 #30

What you pay tax on is the amount you change into FIAT. It is simply NOT considered capital gain, or bloomin' anything else.. might as well start trying to declare World of Warcraft gold or Eve online currency (can't remember what that's called) as your 'capital gains' ..

I can only speak to the USA, but converting it into something of value other than USD should still be a taxable event I believe. It'd fall under barter most likely:

http://www.irs.gov/taxtopics/tc420.html

That is, I pay you (as a barter since bitcoin isn't an actual legal tender, yet?) X bitcoins for a car worth $15,000 USD. That places my mined bitcoins at a value of $15,000 USD with a cost basis of zero, for a $15,000 realized gain.

OK, if you had btc of $15,000 USD value (lets use a random number, 200 btc), then brought a car with that amount. You now have a car, would you still have to pay tax on the btc that you no longer have?

On the car, yes, same as in the UK. But you don't pay tax on stuff (money/btc) you don't have.

So, in the US you'd have to declare your btc, pay tax on that as if it was $15,000? (how do you propose to pay that tax in btc exactly? Does the IRS have a Bitcoin wallet now that I'm unaware of?).



Nobody actually pays tax on barter.

Jobe7
Full Member
***
Offline Offline

Activity: 238
Merit: 100


Now they are thinking what to do with me


View Profile
April 21, 2013, 03:06:41 PM
 #31

Quote
Nobody actually pays tax on barter.

Backing my point even more then Smiley ty
unk
Member
**
Offline Offline

Activity: 84
Merit: 10


View Profile
April 21, 2013, 03:11:44 PM
 #32

OK, if you had btc of $15,000 USD value (lets use a random number, 200 btc), then brought a car with that amount. You now have a car, would you still have to pay tax on the btc that you no longer have?

On the car, yes, same as in the UK. But you don't pay tax on stuff (money/btc) you don't have.

So, in the US you'd have to declare your btc, pay tax on that as if it was $15,000? (how do you propose to pay that tax in btc exactly? Does the IRS have a Bitcoin wallet now that I'm unaware of?).

you're not thinking about it correctly. we pay tax all the time on things we don't 'have'. for example, if you earn USD $15,000, you pay tax on that income regardless whether you spend it or save it.

the principle is really very simple, but most people who haven't studied it get very easily confused and make bad assumption after bad assumption. the united states's principle is very straightforward: you owe tax on all income received, from whatever source derived.

that includes noncash compensation. when something isn't cash, the value for tax purposes is its fair market value at the time you received it. of course, fair market value can be disputed; it is up to the taxpayer to declare it and the IRS to challenge it. (if an intentional understatement, it can lead to civil or criminal penalties.)

so if you buy 150 BTC at $100 and immediately use it to buy a car, you owe no tax merely because you used bitcoins. (you might owe a sales tax in the US on the car, of course.) if you buy 150 BTC at $50, wait until it appreciates to $100, and use it to buy a car, you owe $7500 in income (specifically, probably capital gains) taxes on the appreciation of the bitcoins.

as to barter, people pay tax on it all the time. individuals who barter for $200 probably cheat the government out of income to that amount, but sophisticated individuals and businesses that engage in noncash transactions certainly do pay tax. i have done it myself, to the tune one year of a $4 million tax bill.

as to the title of the thread, it is because not everyone is an extremist anarchist; most people adopt ethical systems that recognise the value of law and government and then adopt the principle that it is appropriate for the costs of government to be split based roughly on income. nobody thinks the tax system in any large country is perfect, but almost everyone in those countries (except in this often ridiculous forum) thinks it is better than having no government at all.
RenegadeMind (OP)
Copper Member
Hero Member
*****
Offline Offline

Activity: 1380
Merit: 504


THINK IT, BUILD IT, PLAY IT! --- XAYA


View Profile WWW
April 21, 2013, 03:12:28 PM
 #33

I hope your house burns down, or you die in the street after being hit by a car, or some other fate
It's funny how often those that preach collectivist principles always end up calling for someone to die.

Isn't it?  Grin

Once you get over the "crabs in a bucket" thing, yes. Smiley

How is judging others as criminals an argument for breaking the law yourself?

As the OP, I assume that you are addressing me... Correct me if I'm wrong.

You're making some wrong assumptions. I haven't broken any laws at all. However, I'm a bit of an edge case and by far not typical of most people.

This is a funny thread: You hate government control and taxes, you believe that officials are corrupt, you are a libertarian, so you agree to the notion of government, unless you are an ancap ideologist, so it's ok to be corrupt yourself? You like infrastructure, but you don't have to pay because you are smart enough to evade tax?

I'll leave that alone as you're making some wild assumptions with no basis.

Isn't that a part of the attraction of bitcoin? You can AVOID tax? And as for "realized gains", why not just sell your bitcoins offline to some person willing to show up at a coffee shop and pay cash?

No, the the attraction of Bitcoins is fast global payments an order of magnitude cheaper than anything else.

Of course you should pay taxes if your investment pays off.

Well, I can't disagree with it being a fantastic payment system.

But as for paying taxes... Why should anyone pay taxes that they don't need to? It's not that hard to get around a lot of tax laws. Yet still, there are many thread with people clambering to cough up when there are many, many ways for them to legally get around it.

A lot of people seem to think that there's no way around tax. Ahem... Google... Ireland... Ring a bell anyone?

It's income just like anything else and that's what makes society work. If I had lived outside society I would statistically not have had the opportunity to learn about this stuff, let alone own a computer.

And the current society is the ONLY one possible? There are no alternatives? Everything has been explored, and we've arrived at the pinnacle?

I find that rather unlikely.

I'm not saying that it's easy to think outside the box. But it seems like a lot of people really, really love the box.

(how do you propose to pay that tax in btc exactly? Does the IRS have a Bitcoin wallet now that I'm unaware of?).

Quite correct. BTC is not something that you *CAN* pay taxes in (the US).

mwag
Newbie
*
Offline Offline

Activity: 38
Merit: 0


View Profile
April 21, 2013, 03:13:37 PM
 #34

RenegadeMind, noone is "eager" to pay tax. But some of us to choose to obey the laws of the country we live in. The forum has plenty of people whose moral code appears to be "it is okay to break the law if I'm unlikely to get caught".

Maybe their moral code is something more like, "It is OK to break the law if the law is unjust." Perhaps they think tax laws are unjust because the taxed do not get to choose where their contribution is used. They might not mind paying taxes for the building of public infrastructure, but they might mind paying taxes for bailing out mismanaged businesses or bombing other people halfway around the globe.
majorddf
Member
**
Offline Offline

Activity: 99
Merit: 10



View Profile
April 21, 2013, 03:15:24 PM
 #35

I am in the UK and have not yet cashed out any coin.

However when I do, I understand from a phone call to the HMRC and a cross check of their website, that I will be needing to pay capital gains tax over a certain tax free threshold, reset annually.

So although there is no 'Bitcoin Tax' the act of changing Bitcoin in to Fiat creates a Capital Gain.

So I just have to make sure that I stick within the £10k or so annual threshold and I don't pay a penny.

However, if I do happen to need to or want to exceed that threshold, will I pay the tax? Of course I fucking will, I don't need or want the hassle of a fine or jail time. Anyone who says otherwise is, in my opinion, a total imbecile.
Luno
Sr. Member
****
Offline Offline

Activity: 504
Merit: 250


View Profile
April 21, 2013, 03:21:37 PM
 #36

I am in the UK and have not yet cashed out any coin.

However when I do, I understand from a phone call to the HMRC and a cross check of their website, that I will be needing to pay capital gains tax over a certain tax free threshold, reset annually.

So although there is no 'Bitcoin Tax' the act of changing Bitcoin in to Fiat creates a Capital Gain.

So I just have to make sure that I stick within the £10k or so annual threshold and I don't pay a penny.

However, if I do happen to need to or want to exceed that threshold, will I pay the tax? Of course I fucking will, I don't need or want the hassle of a fine or jail time. Anyone who says otherwise is, in my opinion, a total imbecile.

+1+1 to the two last posts. We can not afford having people looking at Bitcoin as a way to cheat on their taxes, nor having a lot of people getting fined for not filing their income in Bitcoin correctly. Taxation guides for each country are being compiled in different threads for the challenged, as I myself was, at the start at the year when the numbers suddenly added up, and my hobby had become an income.
unk
Member
**
Offline Offline

Activity: 84
Merit: 10


View Profile
April 21, 2013, 03:23:48 PM
 #37

So although there is no 'Bitcoin Tax' the act of changing Bitcoin in to Fiat creates a Capital Gain.

the act of disposing of it (for fiat or anything else) is what creates the capital gain. it doesn't matter if you sell it for 'fiat' currency, goods, services, land, or anything else.

the mistake people keep making is to assume that a nation's fiat currency has any special place in computing the timing or amount of capital gains, except as the denomination of value in which the tax is paid. the way the tax laws work is much simpler: if you buy something for something worth $X and trade it away for something worth $Y, you owe $(Y-X) in (capital gains) taxes.  (modulo, of course, the exceptions you mentioned, like bands of tax-free income for small amounts.)
Jobe7
Full Member
***
Offline Offline

Activity: 238
Merit: 100


Now they are thinking what to do with me


View Profile
April 21, 2013, 03:34:43 PM
 #38

I am in the UK and have not yet cashed out any coin.

However when I do, I understand from a phone call to the HMRC and a cross check of their website, that I will be needing to pay capital gains tax over a certain tax free threshold, reset annually.

So although there is no 'Bitcoin Tax' the act of changing Bitcoin in to Fiat creates a Capital Gain.

So I just have to make sure that I stick within the £10k or so annual threshold and I don't pay a penny.

However, if I do happen to need to or want to exceed that threshold, will I pay the tax? Of course I fucking will, I don't need or want the hassle of a fine or jail time. Anyone who says otherwise is, in my opinion, a total imbecile.

What he said Smiley

Until HMRC recognizes btc as a currency and creates a btc wallet to receive taxes, there's nothing we can do even if we wanted to (unless ofc we change all our btc to fiat (assuming its over the threshold) declare that fiat, pay the taxes, then change all the fiat back into btc), which is bloody stupid in anyones book.. And ye, as the person above says, if you're going to cash out xxx amount over the threshold, then ye.. it's bloody daft NOT to declare it (if you have to for any purposes).
RenegadeMind (OP)
Copper Member
Hero Member
*****
Offline Offline

Activity: 1380
Merit: 504


THINK IT, BUILD IT, PLAY IT! --- XAYA


View Profile WWW
April 21, 2013, 03:49:54 PM
 #39

There's a serious disconnect here...

There is NO reason to assume that AVOIDING tax is the same as CHEATING tax.

There are plenty of ways to avoid tax without being a "cheat". Sure, many people won't take advantage of the legal ways to get around being gang raped for more than they need to pay, but that doesn't necessitate that just because YOU didn't take advantage of those ways that other people are cheats.

Again, this is just more buying into common misperceptions.

If you can avoid tax, why not? Large corporations do it all the time.'

Why is it ok for a fortune 500 company to do something, but it's "immoral" or "unethical" for you to do it?

I say BS. If you don't work the system, it will work you. Just take advantage of the ways to avoid tax that are available. There are LOTS of ways.


kokjo
Legendary
*
Offline Offline

Activity: 1050
Merit: 1000

You are WRONG!


View Profile
April 21, 2013, 03:56:22 PM
 #40

There's a serious disconnect here...

There is NO reason to assume that AVOIDING tax is the same as CHEATING tax.

There are plenty of ways to avoid tax without being a "cheat". Sure, many people won't take advantage of the legal ways to get around being gang raped for more than they need to pay, but that doesn't necessitate that just because YOU didn't take advantage of those ways that other people are cheats.

Again, this is just more buying into common misperceptions.

If you can avoid tax, why not? Large corporations do it all the time.'

Why is it ok for a fortune 500 company to do something, but it's "immoral" or "unethical" for you to do it?

I say BS. If you don't work the system, it will work you. Just take advantage of the ways to avoid tax that are available. There are LOTS of ways.
it is also immoral for the fortune 500 companies...

"The whole problem with the world is that fools and fanatics are always so certain of themselves and wiser people so full of doubts." -Bertrand Russell
Pages: « 1 [2] 3 4 5 6 7 8 9 10 11 12 13 14 15 16 »  All
  Print  
 
Jump to:  

Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!