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The IRD issued a ruling which applies to only salary/wage earners and to the situation where:

  • The employer is issuing crypto assets (could be for Initial coin or exchange offering)
  • The employee will receive crypto assets only if they are still employed by the employer at a specified future date and
  • The employee cannot sell or otherwise transfer the crypto assets until the specified future date

What are the tax rules for Crypto Assets?

A fringe benefit will be provided under CX 2 where the above conditions are met. It will be important to determine:

  1. Whether there is a benefit

The term benefit has a wide meaning and therefore would include anything that could be reasonably understood to be a benefit. Therefore, crypto assets would constitute as benefits.

  1. When the benefit is provided

The ownership of the benefit, in this case, crypto assets, does not pass until the requirements for entitlement of benefit are met. Determining this can require careful consideration of the legal arrangements between the employer and the employee.

  1. What the value of the benefit is

S RD 40(1)(a) of the ITA 2007 outlines the method in which to value the benefit

The law surrounding crypto assets is still vague and complex as it is new. For more information on the general treatment of crypto click here. For specific advice regarding your situation, contact us below.


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New Zealand Tax Accountant.