Crypto tax calculation platform Koinly added Terra (LUNA) wallet support to make tax calculation easier for LUNA holders as the Canadian tax report deadline draws near.
Tony Dhanjal, head of tax at Koinly, said that LUNA support has been requested by many Koinly users, and with the integration, LUNA users will have a "way to accurately track and record their transactions to meet their tax obligations."
Calculating crypto tax is easy if a user’s crypto affairs are simple. However, Dhanjal told Cointelegraph that “the average crypto investor is connected to three to five exchanges, wallets or blockchains.” Because of this, working out the taxes using these sources is very difficult and the risks of errors are high. This is why Dhanjal recommends the use of a simple crypto tax calculation tool.
Apart from this, Dhanjal emphasizes the importance of paying crypto taxes. While the process varies, most countries require crypto tax to be reported. The tax expert encourages people to pay not only their crypto taxes but any other tax that they are liable for as an individual or a business. Dhanjal explained that:
“Ignorance is not a valid excuse, and there could be a fine line between this and tax evasion, which is illegal [...] The penalties for tax evasion can be severe, not to mention the reputational and other damage to you or your business, this could cause.”
Related: Russia to include crypto into its tax code: Here is what the rules might look like
In a Cointelegraph interview, EY crypto tax executive Thomas Shea reminded people that buying crypto with fiat or any unrealized gains is not a taxable event. Shea also said that the same applies to nonfungible tokens.
Meanwhile, crypto projects based in India recently shared plans to move to more crypto-friendly jurisdictions because India's crypto tax law imposes a 30% crypto tax on holding and transferring digital assets.