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This ruling applies to the situation where payment of remuneration to an employee is done in crypto assets. It does not apply to self-employed taxpayers. Where there is regular payment of remuneration in crypto assets, PAYE will apply. Payments of crypto assets that are not subject to PAYE will be fringe benefits and therefore subject to FBT.

PAYE payments must be:

  • For services performed by the employee under an employment agreement
  • A fixed amount
  • A part of the employee’s remuneration package

If the payments meet the above requirements, the crypto asset payments are PAYE income payments and will therefore be subject to the PAYE rules. However, not all crypto assets will be subject to PAYE. To be considered “salary or wages” for tax purposes, the crypto assets need to be sufficiently similar to the existing notions of salary and wages. This is the case when crypto assets:

  • Are not subject to a lock up period
  • Can be converted directly into fiat currency and a significant purpose of the crypto asset is to function like a currency or the value of the crypto asset is pegged to a fiat currency.

The law surrounding crypto assets is still vague and complex as it is new, for specific advice regarding your situation, contact us below.


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