How to Accept Cryptocurrency Payments in New Zealand
Cryptocurrencies like Bitcoin can be used in retail stores just as easily as paying by cash or card. Accepting cryptocurrency in New Zealand is completely legal and more retailers are making the move each year. Stand out from your competitors and get ahead by learning how to accept crypto in your retail store today.
Companies all over the world are accepting cryptocurrencies, including Microsoft, KFC, Virgin Airlines, and Shopify just to name a few. There are currently 44 known businesses that accept Bitcoin in New Zealand, check them out and keep a lookout for signs like the one below.
What you need to know
To accept cryptocurrency in New Zealand, it’s important to understand what they are and how they work. Many of your customers may have little understanding, and as a retailer, you have the wonderful opportunity to teach them. Cryptocurrencies are digital coins that use blockchain technology to process peer-to-peer transactions. A blockchain is decentralised and this means that your transactions are secure and do not go through an intermediary, such as a bank. This means that when a customer pays with cryptocurrency, the transaction is only managed by the customer and the retailer. This offers retailers and everyday users with a bunch of advantages, which we will get into later in this article.
How to handle tax
Merchants can accept payments in cryptocurrencies easily, however, New Zealand stores must pay tax on all transactions. Tax works differently for crypto as it’s not classed as a currency, but rather as property instead. Take a look at Easy Crypto’s cryptocurrency and tax guide for more information, but for retailers, there are three key points that you must understand:
- Just like with other income in your business, you are required to pay income tax on any profit you earn. This includes purchasing, selling, or trading any cryptocurrencies.
- You must pay GST on all cryptocurrency payments in New Zealand. Although, the IRD may remove this, a GREAT reason to start looking into accepting crypto in your store!
- You must know the value of the cryptocurrency in NZD when making a transaction. This includes buying, selling, or swapping one type of cryptocurrency for another.
Tax surrounding crypto payments will be subject to change when they become more prevalent in our day to day lives. Check out the IRD’s guidance on the current laws that affect cryptocurrency payment in New Zealand here. When a customer pays in crypto, you are required to know the value of the coins when you receive them. There are several ways to do this, but to make your life easier, we recommend using a payment processor that can exchange the coins into NZD instantly.
How to process cryptocurrency payments in New Zealand — BitPay
BitPay allows retailers to accept Bitcoin, Bitcoin Cash, Ether, or Ripple and is the largest crypto payment processer worldwide. BitPay allows a retailer to settle their payments in their local currency, Bitcoin, or a mix of the two. The payments are then processed into an allocated bank account at a guaranteed exchange rate at the end of each business day. BitPay can be integrated into retail stores in several easy ways to suit your needs:
- The easiest option is using the BitPay mobile app that generates a QR code. Each unique code has the correct wallet address and correct value of funds already attached.
- By integrating an API into almost any type of POS system. This option is a little more difficult but is more suitable for large retailers. This option will require some programming and to find out more information, click here.
- Sending clients a one-off or recurring invoice via email.
How to start using BitPay – Mobile app
To use BitPay, your store will first need a wallet. Your wallet is your bank account and you can find more information about cryptocurrency wallet on our Learn-site. To get started accepting cryptocurrencies, follow these simple steps.
- Create your Bitpay wallet
You can do it by following the steps in this video.
- Begin accepting cryptocurrency
You can start accepting cryptocurrency by clicking here and registering as a business account.
- Fill in your business details
Complete all the required information to register.
Confirm your email and get verified.
- Select ‘Point of Sale App.’
- Download the ‘BitPay Checkout’ app
After that, name your device.
- Add pairing code
On the website, add a new pairing code and enter this into the ‘Checkout’ app.
- Setup wallet address
Find your wallet address on the ‘Wallet’ section on the BitPay app, select ‘Bitcoin’ and select ‘Receive.’ Copy the wallet address to your clipboard.
- Enter your settlement information on the BitPay website
Choose ‘Bitcoin (BTC)’ for your currency, and enter the copied wallet address into the ‘Address’ bar.
- Link your BitPay account
Under ‘Settings’ on the BitPay app, select to link your BitPay account.
Your account will now be ready to accept cryptocurrencies. To process a payment, open the checkout application, enter the value that the customer will spend, select the cryptocurrency you wish to use, and allow the customer to scan the QR code from their devices wallet. Your transaction will then be processed, and the funds will be received in your BitPay Wallet.
NOTE: This guide is for how to accept and store crypto. If you wish to exchange the coins for NZD automatically, edit this in your settlement options.
BitPay takes away the confusion of accepting cryptocurrencies in retail, and if you’re interested in finding out more, take a look at their website.
Benefits of accepting cryptocurrencies
There are many reasons for a retailer to accept cryptocurrencies in their stores. Here are two awesome reasons why!
Transactions between customers, merchants, and banks can take yonks. However, cryptocurrencies can be much quicker. Transaction speeds can heavily depend on how busy the network is, but the average Bitcoin transaction takes less than 90 minutes. However, other cryptocurrencies like DASH can be processed in under 2 seconds.
Cryptocurrencies are incredibly secure and can add an extra layer of safety for retailers when storing value. Storing value digitally can reduce the risk of your hard-earned cash being stolen!
You might be accepting cryptocurrencies already!
Without even knowing it, your retail store might have accepted cryptocurrencies already! Bitcoin debit cards are taking the world by storm, where retailers get paid in their currency while the customer is charged from their cryptocurrency wallets. This gives the customer the ability to spend their crypto without the retailer needing to put any infrastructure in place. If you are interested in a card yourself, take a look at a few options here.
As cryptocurrency in New Zealand becomes more widely used, we recommend exploring some options on how you can accept crypto in your retail store. Accepting cryptocurrencies will allow your business to become an innovative early adopter and help you continue on the path to success.
More retailers are accepting cryptocurrencies in their stores each year. Take a look at our complete list of businesses that accept Bitcoin in New Zealand and if you get the chance, pay them a visit!
If you are interested in accepting cryptocurrencies as a retailer, we recommend taking a look at our Cryptocurrency and Tax Guide for New Zealanders. If you would like to seek more advice, get in touch with Tim Doyle, he is an accounting expert on all things tax and crypto.
And if you need any help on accepting cryptocurrency payment in New Zealand, or if you’d like to see your retail business added to our list, flick us an email.