Swedish Man Linus Dunkers has filed a court case after being charged $885,000 in tax for Cryptocurrency trading. An amount he says is over three times all the profit he made, as per a report from SVT January 20, 2019.
A Million Ways to Tax
One aspect of cryptocurrency adoption that has caused great frustration is the issue of paying taxes. While some progress has been made in varying parts of the world, in other parts these laws can be confusing at best.
The person in question is Linus Dunkers, who began trading in cryptocurrency in 2014 and since then, has traded about $2.8 million worth of bitcoin over tens of thousands of trades.
Unlike some citizens, Dunkers wasn’t trying to hide his activities but approached the Swedish Tax Agency himself to report his income, under the impression that he would pay a few thousand dollars.
However, he was in for a shock when he was paid a visit by four agents of the tax authority. In a movie-esque way, the men entered his home and according to him, had conducted great research on him and knew everything about him, all the way down to his dog’s name. Then proceeded to inform him that he owes a total of $885,000 to the tax authority, an amount he claims is absurd.
Point of Contention
According to him, despite the amount of bitcoin he has traded, his profit margin is actually very low and the amount of tax he is being charged is over three times the profit he made over his entire trading career.
Dunkers says that the treatment of his activities as a business is making things harder for him. He is hoping there will be some change of heart.
Not everyone is on the same page as him, unfortunately. Henrik Kisterud, the control coordinator for the tax agency, believes that the investigations carried out were in good faith.
“We should not go here and say that we are 100% safe. But we think we have a good basis in these investigations where we have made judgments about business activities,” he said.
Getting Up to Code
A number of countries are just starting to take the taxation of cryptocurrency activists seriously and thus, there is still a long way to go till their tax codes are perfected and issues like this are resolved.
Many tax codes do not take the unique nature of cryptocurrency trading and its fluctuating value into consideration. An example of this can be seen in a prior incident when a student invested $5,000 into Cryptocurrency but ended up owing $500,000 in taxes.