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Saturday, May 28, 2022

Sydney brothers raise $4m to help solve tax ‘nightmare’

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A Sydney sibling duo has raised $4 million from a swathe of high-profile backers to help crypto investors streamline their tax affairs as the Australian Taxation Office (ATO) ramps up its crackdown on unpaid digital asset taxes.


CryptoTaxCalculator, founded by brothers Shane and Tim Brunette in 2018, is a software start-up that collates data from hundreds of major crypto exchanges, blockchains and decentralised finance (DeFi) services and generates a report compatible with a range of different tax jurisdictions.

CryptoTaxCalculator was founded by brothers Shane and Tim Brunette in 2018.

Tax obligations for crypto traders have long been viewed as a quagmire, as different countries have varying rulings on how certain digital assets are classed. Further, complex transactions such as staking crypto via DeFi or trading non-fungible tokens often have little-to-no tax guidance, leaving users to guess how to best categorise their gains or losses.


Co-founder Shane Brunette told The Age and The Sydney Morning Herald these were the exact issues he ran into when attempting to establish his own decentralised crypto exchange in 2017, a process that led him and his brother to launch CryptoTaxCalculator.

“Out of that experience, we ran into this issue with crypto tax returns, which was ‘how do you do your taxes if there isn’t a financial middleman there to provide you with the tax history?’,” he said.

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“The transaction history getting published to the blockchain is in a format that isn’t anything that resembles what somebody needs from a tax perspective. So that’s what we set out to solve.”


The program, which costs between $50 and $300, covers the vast majority of crypto trading scenarios, including DeFi loans, transaction (gas) fees, crypto staking and leveraged trading. So far it has processed more than 125 million transactions, with growth of over 1700 per cent in the last 12 months thanks to the COVID-fuelled crypto boom.

Local venture capital firm Airtree has led the round, joined by US crypto giant Coinbase and 20VC, a fund run by podcaster turned investor Harry Stebbings.



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