SA Crypto Tax: The truth and nothing but the truth

SA Crypto Tax: The truth and nothing but the truth
Since the crypto industry is not yet regulated by South African regulators, does one have to pay taxes on cryptocurrencies in South Africa? AltCoinTrader CEO, Richard de Sousa recently interviewed leading SA crypto tax expert, Thomas Lobban from Crypto Tax Consulting to answer a few burning crypto tax-related questions.

Do I have to pay tax on cryptos?

SARS classifies cryptocurrencies as intangible assets. This means that if you earn or accrue any income from cryptocurrencies, you have to pay tax. Since cryptos are not regarded as currency for tax purposes, normal tax principles apply. Lobban said regardless if the crypto industry is regulated or not, paying tax is every SA crypto trader’s duty. However, one has to differentiate between the tax conditions related to capital or revenue accounts.


If you are trading cryptocurrencies with the purpose of making a profit and not to HODL as an investment, you are dealing with revenue income. It is the same as getting a salary from an employer.

Capital gains form part of Income Tax but is taxed at a different rate. Captain Gains Tax applies when you sell an investment like Bitcoin for example, for a profit. Profit entails the selling price covering the “base cost” and any additional amounts spent that is relevant to the investment. Capital gain is taxed at a lower rate than normal income.

When is cryptos tax-free?

During the interview, Lobban said that in case of a donation, airdrop and earning staking rewards, it becomes arguable if it is taxable or not. “I regard receiving cryptocurrencies as a donation or reward for already holding crypto similar to earning interest.”

This brings to mind AltCoinTrader’s Easy Save tool that allows traders to earn rewards on their cryptos. Does this mean that traders are liable for earning interest/rewards on this platform? “There’s no tax on it until you transact it away. It’s a taxable activity, but not subject to surprise tax that will reduce it down to a ‘what’s the point’ transaction. It is a good idea to participate in Easy Save,” said Lobban.

Lobban said that if you bought cryptos a long time ago, and it has since gone up in value, you never sold then there is no need to declare it to SARS. “If you haven’t sold the asset, then it doesn’t matter how much it has gone up. There’s no tax implication for that.”

The bottom line

Currently, every taxpayer’s situation is unique. At the end of the day, it is the responsibility of the individual to keep data of their transactions and make your declarations to SARS. Do not hesitate to contact a professional crypto tax consultant