McCullough Robertson establishes Digital Currency Team in Sydney
11 June 2014
With industry facing increased uncertainty about the regulation of Bitcoin and other digital currencies, McCullough Robertson has set up a Digital Currency Team at its Hunter Street office in Sydney.
The Digital Currency Team focuses on taxation and regulation of digital currencies and electronic money and draws on expertise from McCullough Robertson’s taxation, intellectual property, corporate and financial services lawyers.
The team, which has a national client base, is headed by tax expert Senior Associate Reuben Bramanathan who warns that an unfavourable view by the Australian Taxation Office (ATO) could have a significant impact for Bitcoin businesses. The ATO intends to clarify its position for the rapidly growing Bitcoin industry by 30 June 2014.
“Bitcoin exchanges and businesses that accept Bitcoin and other digital currencies could face unintended ‘double GST’ in some circumstances if the ATO does not regard Bitcoin as money,” Mr Bramanathan said.
“In this situation, some Australian businesses may be inclined to move certain parts of their operations offshore.
“At the moment, the law is unclear and our clients are eagerly awaiting the ATO’s view.”
If bitcoins are not regarded as money and not treated as input taxed, then Bitcoin exchanges would have to pay GST every time they supply a bitcoin to an Australian resident.
In recent months the number of digital currency users has increased rapidly. There are now estimated to be at least 40,000 Australian Bitcoin users. This number is expected to continue to rise quickly with Bitcoin ATMs recently installed in Sydney, Melbourne and Brisbane.
Mr Bramanathan, who was a national finalist in the Senior Associate category of the 2013 Lawyers Weekly Australian Law Awards, is the co-author of Tax treatment of Bitcoin in Australia, a position paper prepared in advance of the ATO’s ruling.
For more information contact: Reuben Bramanathan on +61 2 9270 8629 or firstname.lastname@example.org or Chris Saxby (Business Development and Marketing Consultant) on +61 2 9270 8655 or email@example.com.
About McCullough Robertson
McCullough Robertson is a leading Australian independent law firm with industry experts combining legal expertise with deep industry knowledge and foresight. The firm provides innovative, relevant and commercial legal solutions to major corporate, government and high net worth individuals across Australia and internationally. Established in 1926, the firm’s major focus areas are the resources (mining and energy), food and agribusiness, technology, telecommunications, health and life sciences (pharmaceuticals), real estate and financial services sectors.