New Zealand just became the first country to allow cryptocurrency salaries, according to a report Monday from the Financial Times. New Zealand's National Tax Service (IRD) has changed its regulations to enable people to get paid with cryptocurrencies so long as the preferred digital coin is pegged to at least one standard or fiat. Also, it is required to be directly convertible to a standard form of payment. Moreover, a regulation should use a currency substitute or linked value to one or more legal currencies.

In a public notice, the New Zealand National Tax Service (NTS) announced the revised income tax law (RD-3). Under the revision, workers are entitled to receive payment for the labor specified in the employment contract as cryptocurrency. An employer may only pay a fixed amount of regular pay in cryptocurrency, not in bonuses.

The revision to the Income Tax Administration Act does not apply to cryptocurrency payments made in the form of stocks as part of the Employee Share Scheme or to cryptocurrency bills paid in the way of commodities to pay fewer income taxes.

Salaries paid in cryptocurrency are subject to taxation at source of income tax. In other words, if an employer pays to the National Tax Service rather than directly paying the benefits, the NTS will be paid back to the taxpayer in the year-end settlement.

Susan Price, who oversees the tax code at the National Tax Service, signed the revised income tax law on June 27. The revision will take effect for three years from Sept. 1. Before the change, under New Zealand law, all salaries had to be paid only in money, the New Zealand dollars

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