Fair market value (FMV)
Also known as: FMV, market value
The price a crypto asset would fetch in an open-market transaction at a given time, used to value non-cash receipts and disposals.
Definition
Fair market value (FMV) is the arm's-length price of an asset at a point in time. It is used to value crypto received as income, the proceeds of a crypto-to-crypto swap, and crypto spent on goods or services. In South Africa, values are converted to rands using a consistent, defensible source and timestamp. Accurate FMV at each event drives both income recognition and base cost.
Example
You receive an airdrop of tokens. Their FMV in rands on the day of receipt is the income you declare and the base cost for any future disposal.
Jurisdiction notes
- South Africa: SARS expects FMV in rands using a consistent source and the correct timestamp for each taxable event.