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Re: Does a trading account in my name that was funded by a friend's crypto need to be declared?

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Hi,

 

What happens in a situation where my friend asked me to trade his crypto for him, and deposited all his wallet funds into a Binance account that I created in my name. If I then carried out approximately 7000 high frequency trades over the year using algorithmic trading bots, with the profits and all coins all given back to him at the end of the year. Would I need to report the profits from those trades and any capital gains as my own income even though it all belongs to him?

I've seen conflicting information about this (here and here)

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Hi @Stone1,

 

Thanks for providing the sources of information you've been looking at.

 

In all instances we recommend to seek answers directly from the source (in this case, us) to avoid the potential risk of mis-guidance. The information provided through our knowledge base article would be the best source to follow, as we acknowledge that trading is sometimes done on another person's behalf, and we outline how to demonstrate this in terms of reporting.

 

As mentioned in the knowledge base article, it's important to keep appropriate records of the cryptocurrency transactions and documentation (such as a written agreement) indicating the transactions were made on behalf of your friend.

 

Generally if you can demonstrate this, then CGT shouldn't apply. However, if you aren't able to provide documents, or if you feel that you need more specific guidance, it might warrant contacting our early engagement team to see what they advise.

 

Community Forum- Knowledge Base

ATO Website- Record keeping for cryptocurrency

ATO Website- Early Engagement

 

RachATO

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Most helpful response

ATO Certified Response

ATO Community Support

Replies 0

Hi @Stone1,

 

Thanks for providing the sources of information you've been looking at.

 

In all instances we recommend to seek answers directly from the source (in this case, us) to avoid the potential risk of mis-guidance. The information provided through our knowledge base article would be the best source to follow, as we acknowledge that trading is sometimes done on another person's behalf, and we outline how to demonstrate this in terms of reporting.

 

As mentioned in the knowledge base article, it's important to keep appropriate records of the cryptocurrency transactions and documentation (such as a written agreement) indicating the transactions were made on behalf of your friend.

 

Generally if you can demonstrate this, then CGT shouldn't apply. However, if you aren't able to provide documents, or if you feel that you need more specific guidance, it might warrant contacting our early engagement team to see what they advise.

 

Community Forum- Knowledge Base

ATO Website- Record keeping for cryptocurrency

ATO Website- Early Engagement

 

RachATO