Is it legal to pay your employee in crypto currency like Bitcoin?
Crypto currency are popular and easy to manage, but i am not sure, whether it is legal or not to pay someone with it and manage your taxes same time.
Katherine Hawes ,
Director of Education and Training at Digital Age Lawyers (formerly New Age Legal Solutions)
Bitcoin is not considered money. however it can be used to pay an employee via a valid salary sacrifice scheme but it will be subject to Fringe Benefits Tax Assessment Act.
I find BitCoin and other crypto currencies so interesting. From a legal view point I have no idea how to classify them - are they currency? goods? something else? Are they subject to GST? Income tax? FBT (as Katherine mentioned above, in some circumstances, yes).
I also find people's motivations for using cryptos intriguing.
Personally, I find the wild fluctuations in the 'value' of each unit worrisome and woudl not agree to be paid in BitCoin.
Ananda Raj Pandey ,
Developer at SavvySME
Thank you Katherine. It will help.