Do you need to pay taxes to pay compensation with virtual curren

1. The income obtained from the purchase of virtual currency by an indivial through the Internet and the sale to others after the price increase belongs to the taxable income of personal income tax, which should be calculated and paid according to the item of "income from property transfer". The original value of the property sold by an indivial is the price and related taxes paid by the acquisition of virtual currency. If an indivial is unable to provide evidence of the original value of his property, the original value of his property shall be verified by the competent tax authorities. All online transactions that earn income should be taxed

2. According to the official reply of the State Administration of Taxation on the issue of indivial income tax on the income of indivials from buying and selling virtual currency through the Internet (GSH [2008] No. 818), the income obtained by indivials from purchasing players' virtual currency through the Internet and selling it to others after price increase belongs to the taxable income of indivial income tax, The indivial income tax shall be calculated and paid according to the item of "income from property transfer". The original value of an indivial's property in selling virtual currency is the price and related taxes paid for his purchase of network virtual currency. If an indivial is unable to provide evidence of the original value of his property, the original value of his property shall be verified by the competent tax authorities.

3. At present, the management of virtual currency in our country is: it is only allowed to buy virtual currency with real currency, but not to convert virtual currency into real currency. However, some virtual currencies have begun to play the edge of the virtual currency into real currency through the form of bonus points, eager to open this channel. If the exchange between virtual currency and real currency is smooth, it actually means that online game merchants have obtained the real financial power to a certain extent, especially when the virtual currency is widely unified. This will cause chaos to the real financial order, indivial profit-making online game operators can fish in troubled waters, and the victims are not just players. At present, the state holds the attitude of "encouraging, guiding and supporting" to the online game instry, but this does not mean that online game merchants are allowed to do whatever they want. Especially for sensitive financial issues, instry insiders said that the network virtual currency should be supervised by the financial authorities. If it is not included in the existing monetary supervision system, it may have an impact on the central bank's monetary policy or even fail, and the virtual currency will seriously interfere with the real world monetary order.

4.

According to the regulations of notice 2014-21 of the IRS:

1. The information range of virtual currency payment is consistent with that of other property payment

2. Virtual currency paid to service providers and independent contractors should be taxed, and the tax rules of freelance also apply to virtual currency. Taxpayers usually have to get form 1099-MISC

3. When using virtual currency to pay wages to employees, they must also pay taxes, and they also need to pay federal income tax and payroll tax

4. The third party accepting virtual currency settlement payment on behalf of the merchant must report the payment status in form1099-k, payment card and the third party network dealer

5. Based on the fact that the virtual currency in the hands of taxpayers is a kind of capital asset, the gains or losses in the transaction of virtual currency and the sales of virtual currency need to be taxed

extended information:

legal status of bitcoin in China

in China, the regulations on the administration of RMB prohibit the proction and sale of token tickets. Because there is no clear judicial interpretation of the definition of token ticket, if bitcoin is included in the "token ticket", the legal prospect of bitcoin in China will face uncertainty

the notice of the Ministry of culture and the Ministry of Commerce on strengthening the management of virtual currency of online games (Wen Shi Fa [2009] No. 20) on June 4, 2009 stated that the application scope of virtual currency of online games was defined for the first time, and the distinction between the current virtual currency of online games and the virtual props in the game was made; At the same time, the notice said that the "notice" stipulates that enterprises engaged in related services must be approved before they can operate< br />

5. In a recent reply to the Beijing Local Taxation Bureau, the State Administration of Taxation said that the income obtained by indivials from purchasing players' virtual currency through the Internet and selling it to others after price increase belongs to the taxable income of indivial income tax, which should be calculated and paid according to the item of "income from property transfer"
according to the regulations, the income from property transfer is calculated as the amount of taxable income, which is the balance of the income from one-time transfer of property (no matter how many times it is paid, it should be merged into the income from one-time transfer of property) minus the original value of the property and reasonable expenses, and the tax rate of 20% is applied to calculate and pay indivial income tax.

6. Referring to the reply on the issue of personal income tax on the income of indivials from buying and selling virtual currency through the Internet (Guo Shui Han [2008] No. 818), the income obtained by indivials from purchasing players' virtual currency through the Internet and selling it to others after price increase belongs to the taxable income of personal income tax, which should be calculated according to & quot; Income from property transfer; Indivial income tax is calculated and paid
according to the indivial income tax law, the income from property transfer should be withheld by the payer.

7. Really? But it's basically the smallest denomination. It's equivalent to 50 yuan.

8. Beijing Local Taxation Bureau:
we have received your request for instructions on the issue of personal income tax collection for indivials who obtain income from online sales of virtual currency (jdsge [2008] No. 114). The reply is as follows:
1. The income obtained by an indivial from purchasing a player's virtual currency through the Internet and selling it to others after a price increase belongs to the taxable income of personal income tax, which should be calculated according to & quot; Income from property transfer; Indivial income tax is calculated and paid
2. The original value of an indivial's property selling virtual currency is the price and relevant taxes paid for his purchase of network virtual currency< 3. If an indivial is unable to provide the original value certificate of the property, the original value of the property shall be verified by the competent tax authority<

State Administration of Taxation
September 28, 2008

9.

Personal income tax shall be paid instead of value-added tax

income from remuneration for labor services refers to indivials engaged in design, decoration, installation, drawing, testing, medical treatment, law, accounting, consulting, lecturing, news, broadcasting, translation, manuscript review, calligraphy and painting, sculpture, film and television, sound recording, video recording, performance, performance, advertisement, exhibition, technical service, introction service, economic service Income from agency services and other labor services

Indivial income tax has three different tax rates according to different tax items:

1. Comprehensive income (income from wages and salaries, income from remuneration for labor services, income from contributions, and income from royalties) is subject to 7-level excess progressive tax rate, which is calculated and taxed according to the monthly taxable income. The tax rate is divided into seven levels according to the taxable income of indivial monthly wages and salaries. The highest level is 45%, and the lowest level is 3%

2. Business income is subject to 5-level progressive tax rate. It is applicable to the income from proction and operation of indivial instrial and commercial households which are calculated on an annual basis and paid in advance by month, and the annual taxable income from contracted operation and leased operation of enterprises and institutions. The lowest level is 5%, and the highest level is 35%, with a total of 5 levels

3. Proportional tax rate. Personal income tax shall be levied on indivial income from interest, dividend and bonus, income from property leasing, income from property transfer, incidental income and other income on a per capita basis, and a 20% proportional tax rate shall be applied

extended data:

objects of personal income tax on labor remuneration

1, legal objects

taxpayers of personal income tax in China are those who have income living in China, and those who do not live in China but obtain income from China, including Chinese domestic citizens, foreigners who obtain income in China, Hong Kong and Macao Compatriots from Australia and Taiwan

Resident taxpayer an indivial who has a residence in China or has no residence but has resided in China for more than one year is a resident taxpayer and shall bear unlimited tax liability, that is, to pay indivial income tax according to law on his income obtained inside and outside China

3. Non resident taxpayer

an indivial who has no domicile and does not live in China, or who has no domicile but has lived in China for less than one year, is a non resident taxpayer, who bears limited tax liability and only pays indivial income tax according to law on his income obtained from China