Question 1: Do I have tax to pay and if so how much

If you've sold, transferred, traded or disposed any cryptocurrency this creates a taxable event. The taxable amount is the difference between the value of when you bought the cryptocurrency and when you disposed of the cryptocurrency, less any fees incurred in the transaction (gas fees or payment processing fees etc) The sum of all of the taxable amounts (profits less losses) of all of your taxable events is your taxable income from cryptocurrency.This taxable income is charged at your marginal tax rate and that tax is paid to IRD. The current tax rates for an individual is as follows.

Up to $14,000: 10.5% Over $14,000 and up to $48,000: 17.5% Over $48,000 and up to $70,000: 30% Over $70,000 and up to $180,000: 33% Remaining income over $180,000: 39%

Even if you haven't yet cashed out this gain to fiat or NZD, the above events are still taxable, unfortunately.

Question 2: When are my taxes due

The end of this financial year is 31 March 2024. If you want to file this yourself you have until 7 July 2024 to file your return and your tax is due to be paid by 7 Feb 2025If you appoint a tax agent (like myself) the due date for filing is 31 Mar 2025, and your tax is due to be paid 7 Apr 2025

Question 3: Do I need an accountant

If you have managed to follow this post so far you may not need one. Further, there are a number of software services to help you do this calculation and can API into your wallets to calculate your taxable income. Koinly and CryptoTaxCalculator are two examples of this.However, often with Cryptocurreny there are a lot of other factors to think about such asTax residencyRestating prior returns if previous year's haven't been filedOwnership if you hold coins or trade on behalf of other peopleTax structure - a company tax rate of 28% sounds great until you want to buy a house and find out you need to top up the difference

Question 4: Cyrpto is decentralised, how will IRD catch me if I don't declare my taxes?

Even though IRD's rulings feel aggressive and it feels like it's taxing unrealised gains, the rules are what they are. A majority of people have invested in cryptocurrency for the purpose of making a profit, which falls under income regardless.If you're ever done KYC or uploaded a copy of your ID with an intermediary to buy/sell cryptocurrency, the chances are they are probably sharing your information with IRD so it's best to be on the right side of the law. If IRD do catch on to taxable income that wasn't declared either through a KYC exchange or a large some of money entering NZ which triggers AML IRD may look to audit you. In this instance IRD will calculate what is owed and then potentially add an additional 20%-100% of the shortfall position depending if they determine the position was due to not taking reasonable care through to taking an abusive tax position. Just because IRD may not have the technology or data to trace earnings on chain back to you now, it doesn't mean they wont' be able to do this future and IRD has the power to go back 7 years to review prior returns.