Local Laws
Before you choose to accept cryptocurrencies on Dtravel, please check that your country allows cryptocurrency activities. Regulation differs considerably between countries, and while many countries have chosen to embrace cryptocurrency, some have banned cryptocurrency explicitly or implicitly.
In November 2021, the United States Library of Congress published a research piece titled Regulation of Cryptocurrency Around the World. The report identified nine countries with explicit bans and 42 countries with implicit bans on certain cryptocurrency activities.
In the context of the report, an explicit ban means that the country has imposed an absolute ban on all cryptocurrency activities. An implicit ban means regulations are in place that limit cryptocurrency activities, such as banning cryptocurrency exchanges or prohibiting banks from servicing individuals/businesses known to be involved in cryptocurrencies.
The nine countries with an explicit ban are: Algeria, Bangladesh, China, Egypt, Iraq, Morocco, Nepal, Qatar and Tunisia. For the list of the 42 countries with an implicit ban and what the ban entails, please read the report.
The report also indicates whether the country applies laws relating to:
(1) anti-money laundering and combating the financing of terrorism (AML/CFT); and
(2) taxation
As of November 2021, 103 countries apply at least one of the above two laws, with most implementing both. In 2018, just 33 countries regulated AML/CFT or taxation in relation to cryptocurrencies (and only five implemented both), demonstrating the pace at which laws have evolved to regulate cryptocurrencies.
In our previous guide, How to Convert Crypto to Fiat, we touched on AML/CFT when explaining know your customer (KYC) verification procedures. AML/CFT laws only apply to businesses involved in converting cryptocurrency, such as exchanges or brokers — not short-term rental businesses.
However, taxation laws are relevant to short-term rental businesses, as taxes must be paid when earning cryptocurrency as income in the course of a business and when converting cryptocurrency.
⚠️ IMPORTANT
The information published in the research paper is subject to change. Please use the resource as a starting point and conduct further research to ensure you have the latest information. |
Taxation of Cryptocurrencies
Contrary to popular belief, most cryptocurrencies are not completely anonymous or untraceable. Increasingly sophisticated blockchain forensics tools are simplifying the task for law enforcement divisions and tax authorities to ensure the law is upheld.
Just as you pay taxes on traditional currencies when you receive bookings from guests, cryptocurrencies earned in the course of your short-term rental business are also taxable in many parts of the world. In tax legislation, this is commonly treated and referred to as income and subject to income tax. Dtravel does not pay these taxes on your behalf.
When you convert your cryptocurrency to fiat currency, this conversion may also be a taxable event, depending on where you pay taxes. Some countries also consider a trade between two cryptocurrencies a taxable event, so consider this before making a trade. In this context, cryptocurrency is usually classified as property or an asset and is subject to capital gains tax.
If you use cryptocurrency to purchase goods or services yourself (such as booking your own vacations on Dtravel), you may also be required to pay tax, depending on the taxation rules in your jurisdiction.
The Library of Congress report includes a link to official tax guidance for over 100 jurisdictions (where this information has been made available by official sources). We highly encourage you to start here.
As we’ve seen over the last few years, rules change quickly, so it’s important to stay informed about the latest regulatory developments. The topic of cryptocurrency taxation is complex and evolving, but one that is necessary to accelerate the adoption of this technology throughout the world.
Disclaimer
The information provided in this guide is general in nature and should not be considered financial or tax advice. It is recommended that you seek independent professional advice specific to your circumstances to ensure you meet your tax obligations. |