- In the ruling employers can send payment to their workers in digital currency.
- The publication stressed the fact the crypto is not a legal tender.
A new published guideline by the tax authority in New Zealand has given a legal go ahead for workers to receive salaries in cryptocurrency. The ruling is expected to take effect on September 1. The information regarding the ruling was released on August 7 by the Inland Revenue Department. In this ruling employers can send payment to their workers in digital currency.
However, certain conditions have been attached to the ruling. For instance, the payment in digital currency must be tax compliant. In that, it must respect normal salary conditions like being a fixed amount. This rules out payments from shares and other equities.
In addition to salary, payments to periodic services, other benefits and commissions will also be allowed in crypto. The publication stressed the fact the crypto is not a legal tender.
“In the current environment where crypto-assets are not readily accepted as payments for goods and services, the Commissioner’s view is that crypto-assets that cannot be converted directly into fiat currency on an exchange are not sufficiently “money-like” to be considered salary or wages.”
Moreover, the cryptocurrencies that are allowed to be used as payment for salaries must function as currencies.
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