Crypto exchange Binance announced on Feb. 6 that it will be launching a tax reporting tool. This service will assist customers in keeping track of their cryptocurrency transactions for the purpose of tax reporting.
The company said this decision was made in response to an increasing number of inquiries from consumers about their own personal tax responsibilities.
According to the statement, Binance Tax provides its users with the ability to receive a tax summary report that details any gains or losses that have occurred in their Binance account throughout the course of the calendar year. This includes donations made in the form of cryptocurrencies, spot transactions, and fork incentives that are based on blockchain technology.
Currently, France and Canada are participating in the pilot program for Binance Tax, which will later this year be rolled out to more worldwide regions that are part of the Binance ecosystem. At this time, it is only accessible for data that is stored on platforms owned and operated by Binance; however, the company claims that in the near future, it plans to expand its reach and look into integrating with other platforms used in the business.
This comes one month after Binance stated that it would be participating in an association to address compliance with global sanctions.
Over the course of the past year, worldwide regulators have tightened their grasp on the cryptocurrency business. This is particularly the case in the wake of the FTX crisis, which rattled the market.
The Securities and Exchange Commission (SEC) of Thailand recently made an announcement that it intends to tighten up laws for the cryptocurrency business with a primary focus on protecting investors. It has come to the attention of regulators in South Korea and the Netherlands that several exchanges have been investigated for possible non-compliance with the norms of their respective countries.
In addition, regulators in the United States have been keeping a close eye on developments in the cryptocurrency industry. Compliance issues led to a settlement that needed to take place between crypto exchange Kraken and the Office of Foreign Assets Control inside the Treasury Department.
In December, the SEC issued a call to businesses demanding that they report their exposure to the risks and bankruptcies associated with cryptocurrency. In the meantime, the chair of a House committee on crypto innovation has presented a bill that would allow businesses to apply to government authorities for what is known as an "enforceable compliance agreement."
