Bulgarian Tax Authorities To Check Local Crypto Exchanges
The Bulgarian National Revenue Agency intends to carry out the audits of local digital platforms and their users, Bitcoin.com reports.
Inspections will affect the firms that indicated cryptocurrency trading as the principal activity. The agency’s aim is to ensure that the crypto business complies with the Bulgarian tax requirements and legislation on social security. Besides, the officials are willing to learn more about the operation of digital exchanges.
The main source of concern of the state tax authorities is the anonymity of crypto transactions, which carries risks of proceeds concealment and tax evasion. The agency has already studied several institutions engaged in the sphere of digital currencies and developed measures to control nine such companies.
The inspectors also intend to analyze data about traders, who use the services of the local digital platforms. Primarily, they want to check whether users are reporting the profit from cryptocurrency transactions.
Bulgaria has not yet developed a specific cryptocurrency taxation system. Therefore, the local legislation equates such a profit to revenues from the sales of traditional financial assets, which should be indicated in the annual declarations of individuals. Moreover, funds received from trading will be subject to the income tax of 10%. This condition applies to both private users and cryptocurrency companies.
Previously, the South Korean authorities conducted audits of local cryptocurrency exchanges to check their compliance with security regulations. Of the 38 platforms, only seven passed the inspection.