Payments made in cryptocurrency are already a reality and will soon be commonplace. With the advent of emerging technologies impacting a large range of sectors and aspects of our lives, progressive approaches to payments are crucial.
Governments around the world, from New Zealand to the U.K., Australia to Portugal, and several others besides, have taken proactive steps toward introducing laws or rulings around the potential for cryptocurrency payments, rather than in fiat currency alone. Recently, New Zealand is emerging as a player in the blockchain and crypto space, with key announcements in 2019 proving it is a forward-looking jurisdiction.
On June 27, 2019, New Zealand’s Inland Revenue Department (IRD) Director of Public Rulings, Susan Price, announced a new ruling determining how taxation on cryptocurrency earnings will be calculated. This ruling provides clarification on how the legislation will give both employees and companies guidance in handling taxes on permanent employees’ salaries when and if they are paid in crypto. The ruling took effect Sept. 1, 2019 for three years.