Have you been doing some trading on Binance Exchange recently? If yes, then you’re gonna have to pay taxes for it for sure.
However, the taxation on the Binance exchange doesn’t work the same way as it does on normal trading. Therefore, one has to make sure to calculate their Binance tax the right way so that it will become easier for you to pay taxes on your crypto trade.
Now without any further ado, let’s begin the journey of calculating taxes on your crypto exchange.
When do you have to Pay Binance Taxes
Before going further, you must first have to know whether you are responsible for paying crypto taxes or not. Below are the circumstances under which paying Binance taxes becomes a must for you. So give it a look and find out if you really have to pay your Binance taxes:
When you’re getting your Income in Cryptocurrency:
Just like you are considered responsible for paying income tax in normal circumstances when receiving salary in cash, the same rule implies on Crypto trade too. You have to pay Binance tax on your monthly income when your company is paying you your salary in digital currency. Yet the ratio of crypto tax depends upon the Tax Laws of your State or country, just for instance Laws for Binance tax UK, USA, etc.
Converting Your Cryptocurrency in Cash:
Are you thinking of converting your digital currency to a fiat one? Well, then be ready to pay tax on it, because the transaction of crypto-coins in the form of cash or fiat currency implies tax in accordance to the country and state.
Paying with your Crypto Coins:
When you use your digital coins to pay off your daily needs like that of buying grocery, food, and goods, paying for services like that of home deliveries, car gas, etc with crypto credit cards, Binance Tax is implied in this situation.
Exchanging One Cryptocurrency with the Other:
We all know that foreign currency exchange implies tax in case we are exchanging it at profit. Binance exchange also charges you tax when you are considering exchanging one Cryptocurrency with the others like converting ethereum to bitcoin or vice versa. However, it too depends upon the respective countries and their requirements such as some countries charges tax on only a few specific crypto-coin exchange.
Calculating Binance Tax – 3 of the Simplest Methods
In the initial years of crypto-currency emergence, calculating the Binance tax was really an issue back then. However, as of now, it has made many advances in the field because of which calculating the crypt-tax has become a lot easier.
There are many companies that provide Binance calculators for their clients so that they can get a hand at their Binance taxes, a few of the renowned and best calculators are discussed below:
Crypto Tax Calculator .Io
Crypto Tax Calculator.Io provides you the most accurate Tax reports that exceed in accuracy and are easiest to understand. Moreover, the feature that makes Crypto Tax Calculator.Io stand out from the crowd is that it Supports DeFi & DEX Trading.
The next one on our list is Koinly, one of the most renowned Binance tax calculators of all, of course. One of the amazing features of Koinly is that it provides you a free preview of the Binance tax report. Moreover, apart from calculating the tax, Koinly also keeps track of your profit and loss gain as well as downloading your tax documents.
Blockpit.io is also one of those remarkable sites that provide an easy and user-friendly calculator for Binance taxation. Its key features include automatic bitcoin tax calculationand downloading PDF trades of tax returns.