New Zealand has become the first country in the world that will legally permit companies to pay out employee salaries in cryptocurrency, as stated by a Financial Times report.
For companies to use this method, the law will require that the chosen cryptocurrency be pegged to a fiat (standard) currency and directly convertible into a standard form of payment. This regulation will permit bitcoin to replace the New Zealand dollar on workers’ pay slips.
As for the issue of income tax, companies choosing to pay workers in cryptocurrency may do so by deducting tax via New Zealand’s pay-as-you-earn plan.
New Zealand’s tax authorities made the decision earlier this month, with the news coming to light through a note filed on 7th August. In addition to the decision on cryptocurrency salary payments, the note also reportedly included a plan to allow for company bonuses to also be paid in cryptocurrency.
Self-employed workers have so far been excluded from the option to hold income in cryptocurrency.