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Tax Reporting Tool by Binance. Will it help Indian Crypto Investors? 2021

Tax Reporting Tool by Binance. Will it help Indian Crypto Investors? 2021.

Binance’s Tax Reporting Tool will be available from 28th July, 4:00 AM UTC. Binance users will be able to access the Tax Reporting Tool via “Account” and “API Management” on both the Binance Website and Binance App. 

Cryptocurrency trading platform Binance has announced to launch Tax Reporting Tool, a new API that will enable Binance users to easily keep track of their crypto activities and streamline reporting requirements. The new tool allows users to transfer their transaction history to a third party, and also obtain overviews of their tax liabilities. Though the tool will help users, it also comes at a time when the exchange has been under fire from regulators globally. Binance is one of the world’s leading blockchain ecosystem and cryptocurrency infrastructure providers. 

Binance’s history has been littered with regulatory controversy. 

Last year, authorities in Malaysia said Binance was illegally operating in the jurisdiction. The announcement came several months after Malta ended its love affair with the crypto exchange too. 

But this year, regulators have turned up the pressure on Binance—specifically targeting the exchange’s insistence that it is “decentralized” and operates without a headquarters. 

All within the last two months, regulators in the U.K., Italy, Japan, and the Cayman Islands have all said Binance is not authorized to operate in their relative jurisdictions.

So this Tax reporting tool comes at a time when the exchange has been under fire from regulators globally.

Anyways, lets see what the tool allows.

 

Binance Tax Reporting Tool allows users to:

  • Transfer read-only user transaction history and records of capital gains and losses on Binance to third-party tax vendor tools
  • Get a real-time overview of their local tax liabilities by integrating third-party tax vendor tools via the Tax Reporting Tool, where the API import function will dynamically pull transaction history and records of more than 1 financial year to file taxes.

Will it help Indian Crypto Investors? 

Though its unclear whether this tool will help India Crypto Investors as there is no regulation around cryptocurrency in India so far. As per Company, Tax Reporting Tool will be part of Binance’s “broader strategy to expand user protection and risk management protocols.” Recent updates under this initiative include revisions to daily withdrawal limits and updated leverage limits for Futures accounts.

Lets see some FAQs on this Topic

FAQ on Binance Tax Reporting Tool

1. Are there any fees for filing taxes via the third-party vendors through API?

 
Depending on the third-party tax platform you use, they will charge you fees for their tax services.
 

2. Do I have to pay taxes when I buy or sell Bitcoin?

 
Though it depends on one's country’s taxation requirements. In India, the answer is YES.
 

3. How do I create an API on Binance?

 
1. Log in to your Binance account and click [Account] - [API Management].
2. Click [Create Tax Report API].
3. You will receive your own unique API and Secret Key for Tax Report, where you can copy both keys to integrate it on the third-party tax vendors. For more information, please refer to How to create API on Binance site.

 

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