Nauru Compliance Report

Regulatory Overview

Regulatory Status

Regulators have not addressed crypto; legal status ambiguous

Key Regulator(s)

Nauru Financial Services Authority, Nauru Ministry of Finance

Primary Legislation

Nauru Financial Services Authority Act 2017: Establishes the NFSA., AML/CTF Act 2017, This is the primary source for information regarding financial regulation in Nau, s specific AML/CTF Act may require searching Nauru, e.g., Securities Act 1974

Travel Rule

Adopted — Threshold: Implemented

Tax Reporting

No Capital Gains Tax: Nauru does not have a specific capital gains tax regime. This means that profits from the sale of assets, including cryptocurrencies, held for investment purposes would generally not be subject to capital gains tax.. Important Nuance: However, if a person or entity is deemed to be trading in cryptocurrencies as a business, or if the activities constitute a profit-making scheme, the gains derived could potentially be treated as ordinary income and subject to income tax (see below). The distinction between "investor" and "trader" is crucial and would depend on the facts and circumstances (frequency of transactions, intent, business-like nature of activities).. Nauru Revenue Act 2014: The primary legislation governing income tax is the Revenue Act 2014 (as amended).. Taxable Income: If crypto-related activities are considered a "business" or a "profit-making undertaking," the profits or gains derived would likely be treated as ordinary income and subject to income tax under this Act. This could include:. Profits from frequent trading of cryptocurrencies.

Key Facts

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