DISCLAIMER: The term “cryptolicense” in this text refers to a digital currency exchange license (DCE license). The use of the term “cryptolicense” is intended solely to simplify the text for the customers and visitors of the website.
Australia has been actively involved in developing a regulatory framework for the cryptocurrency industry. Australia recognized the potential of cryptocurrencies early on, recognizing them as a legal form of currency and financial asset. Already in 2017, the Australian government passed legislation that brought digital currency exchanges under the jurisdiction of the Australian Transaction Reports and Analysis Centre (AUSTRAC), the country's financial intelligence agency. This innovation has had a significant impact on companies that deal in cryptocurrencies.
AUSTRAC has introduced new licensing requirements for digital currency exchanges (DCEs), which includes compliance with anti-money laundering (AML) and counter-terrorist financing (CTF) standards. With these changes, Australia has created a transparent and trustworthy jurisdiction for cryptocurrency transactions, which helps increase investor and user confidence.
To obtain a cryptolicense, companies must submit the appropriate documents and register with AUSTRAC. It is important that all cryptocurrency transactions comply with national and international security standards.
Thus, Australia is becoming one of the leading countries in the world that actively supports the development of the cryptocurrency industry, while ensuring high standards of security and transparency for all market participants.
The Australian Transaction Reports and Analysis Centre (AUSTRAC) regulates companies that deal with cryptocurrencies
Key Numbers about Cryptolicense in Australia
nominimum share capital |
30%corporate income tax (CIT) rate |
6 weeksaverage time of starting new project |
0%WHT rate for fully franked dividends |
3 yearscryptolicense renewal period |
10%goods and services tax (GST) rate |
Legal Opinion about Cryptolicense in Australia
Ganna Voievodina
Manimama
|
CEO
“As a cryptolawyer, I know the value of expanding a business into global markets. A cryptolicense in Australia opens doors to new clients and offers additional opportunities. Invest in your future and grow your business without borders.”
Types of Activities with a License in Australia
Exchange crypto to crypto
DCEs are authorized to facilitate the exchange of various virtual assets, including utility tokens and coins, ensuring diversified trading options.
Exchange crypto to fiat and fiat to crypto
DCEs enable the conversion between cryptocurrency and fiat currencies, offering customers the flexibility to transact in multiple currencies.
Benefits of Obtaining a Cryptolicense in Australia
Transparent regulatory environment:
- The Australian Transaction Reports and Analysis Centre (AUSTRAC) provides strict oversight and regulation of cryptocurrency companies.
- Clear AML/CTF compliance requirements create a transparent business environment.
High level of investor confidence:
- The country is recognized for its reliability and stability, which attracts international investors.
- Regulation by AUSTRAC increases confidence in the safety of transactions and funds.
Developed financial infrastructure:
- Australia has a highly developed financial system that supports the integration of cryptocurrency transactions with traditional banking services.
- The presence of numerous cryptocurrency exchanges and exchangers facilitates the exchange and trading of digital assets.
Recognition of cryptocurrencies as legal tender:
- Australia has officially recognized cryptocurrencies as a legal form of currency and financial asset.
- This makes it easier for cryptocurrency companies to legalize and operate.
Simplicity of licensing process:
- The process of applying for a cryptolicense is transparent and simplified.
- Companies can submit all the required documents online, which speeds up the licensing process.
Access to international markets:
- A license obtained in Australia opens doors to international markets, enhancing the reputation of the company.
- The country is a member of many international organizations, which facilitates cross-border business.
Our Services
Popular package
Premium
Full set up of cryptobusiness with all the necessary infrastructure
- Company formation in Australia
- Company name of your choice
- Individual business plan with 3 scenario
- Individual AML/KYC policies
- Obtaining a cryptolicense
- Registration of the activities within AUSTRAC
- Apostilled corporate documents
- Handling the communication with AUSTRAC
- Local Anti-Money Laundering officer
- Local virtual office for one year
- C2B account for cryptocurrency transactions
Advanced
Standard set up of company infrastructure for the start of operational activity
- Company formation in Australia
- Company name of your choice
- Individual business plan with 3 scenario
- Individual AML/KYC policies
- Obtaining a cryptolicense
- Registration of the activities within AUSTRAC
- Local Anti-Money Laundering officer
- Local virtual office for one year
Basic
Obtaining a cryptolicense in accordance with the minimum regulatory requirements
- Company formation in Australia
- Individual business plan with 3 scenario
- Standard AML/KYC policies
- Obtaining a cryptolicense
Our Experts in this Area
Step by Step Description
-
Step 1. Company incorporation
- Determine business structure (e.g., Pty Ltd, partnership, sole trader)
- Choose a business name
- Obtaining an Australian Business Number (ABN) from the Australian Business Register (ABR) because it is essential for tax and other business dealings
- Register for Goods and Services Tax (GST), if applicable
- Prepare company constitution
- Appoint at least one director and, if required, a company secretary and ensure directors are at least 18 years old and have consented to their appointment
- Decide on the share structure and issue shares to initial shareholders
- Company registration
- Obtaining a certificate of registration
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Step 2. Obtaining the license
- Develop and implement an AML/CTF program compliant with AUSTRAC regulations, appoint a compliance officer
- Submit Digital Currency Exchange (DCE) Registration form with AUSTRAC and supporting documentation (such as business plans, risk assessments, and compliance manuals)
- AUSTRAC will assess an application, conducting due diligence on business
- Upon successful assessment, AUSTRAC will approve an application and the company be officially registered as a DCE in Australia
Understanding Requirements in Australia
A license is required for cryptocurrency exchanges
Australia has introduced a licensing regime for digital currency exchange providers. Obtaining an AUSTRAC license is mandatory for such companies.
A licensee may be an individual, business or organization that conducts the following exchange:
If you plan to provide cryptocurrency services, you must be registered with AUSTRAC before you can carry on such activities. It is illegal to provide cryptocurrency services in Australia without registration.
Obligations for licensees:
Requirements for Obtaining a Cryptolicense in Australia
It is necessary to have an ACN or ABN to obtain a cryptolicense
Following information is required for obtaining cryptolicense:
- the services that business provides
- the structure of business
- contact details for business
- the names and contact details of key personnel in business, such as directors and officeholders
- an official police document for each of the key personnel in business (acceptable documents - National Police Certificate, foreign equivalent of a National Police Certificate, National Police History Check)
- financial statements for the most recent financial year
- registration numbers such as an ABN or an Australian Company Number (ACN)
- registration details if business is registered in a foreign country
- any criminal, civil or enforcement action relating to business and key personnel
Taxes in Australia
Australia does not have a VAT system
The Australian Taxation Office (ATO) provided guidelines on how cryptocurrencies are taxed. Cryptocurrencies are generally treated as property for tax purposes.
Capital gains tax (CGT) may apply to the disposal of cryptocurrencies and individuals are required to report such transactions in their tax returns. The CGT rate in Australia is generally equal to the individual's marginal income tax rate, and it applies to the capital gain made on the disposal of assets.
Personal income tax (PIT) vary based on income levels, with the rates ranging from 0% to the top marginal rate of 45%:
Tax rates 2023–2024
1) 0 – $18,200 – 0%
2) $18,201 – $45,000 - 19% for each $1 over $18,200
3) $45,001 – $120,000 - $5,092 plus 32.5% for each $1 over $45,000
4) $120,001 – $180,000 - $29,467 plus 37% for each $1 over $120,000
5) $180,001 and over - $51,667 plus 45% for each $1 over $180,000
Corporate income tax (CIT) - every corporation is liable to a federal tax rate of 30% on their taxable income, except for businesses categorized as 'small or medium' enterprises. These entities enjoy a discounted tax rate of 25%. However, this reduced tax rate is applicable solely to companies that, in conjunction with specific 'connected' entities, remain below the combined turnover limit of AUD 50 million.
Goods and services tax (GST) is a broad-based tax of 10% on most goods, services and other items sold or consumed in Australia.
Additionally, Australia does not have a Value Added Tax (VAT) system. Instead, it uses the GST system, which is similar to VAT systems in other countries.
Frequently Asked Questions
-
What is a cryptolicense in Australia?A cryptolicense in Australia is a permit issued by the Australian Transaction Reports and Analysis Centre (AUSTRAC) that allows companies to legally operate in the cryptocurrency industry.
-
What are the requirements for companies to obtain a cryptolicense in Australia?Companies must meet AUSTRAC's requirements, including compliance with AML/CTF regulations, providing full beneficiary information, business documentation, financial statements, etc.
-
How long does the process of obtaining a cryptolicense take?The process of obtaining a cryptolicense can take up to several months depending on the completeness of the submitted documents and compliance with all requirements.
-
What activities are covered by the cryptolicense in Australia?Cryptolicense covers cryptocurrency exchanges, as well as the exchange of cryptocurrency for fiat and vice versa.
-
What are the benefits of a cryptolicense in Australia?Cryptolicense provides access to international markets, increases investor confidence, and makes it easier to do business through a transparent regulatory environment.
-
What is AUSTRAC's role in regulating cryptocurrency companies?The AUSTRAC is responsible for licensing and supervising cryptocurrency companies, ensuring compliance with AML/CTF regulations and other legal requirements.
-
Can cryptocurrencies be used as a means of payment in Australia?Yes, cryptocurrencies are recognized as a legal tender and financial asset in Australia, which facilitates their use in various business transactions.
-
How can I check the status of a cryptocurrency company in Australia?The status of the company can be checked on the official website of AUSTRAC, where the register of licensed companies is available.
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What are the steps involved in the process of applying for a cryptolicense in Australia?The process includes registering a company, collecting the necessary documents, and filling out the application on the AUSTRAC website.
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