Cryptocurrencies & Australian Tax!

The world of cryptocurrency is somewhat complex, in its workings and taxation. This article aims to provide general information on how the ATO treats key cryptocurrency transactions.  

If you have been involved with any of the following, there is a possibility that the ATO will either know about it, and/or taxation will need to be paid: 

• Exchanging a cryptocurrency for another cryptocurrency. 

• Investing in cryptocurrency (including trading). 

• Staking rewards and airdrops (including mining). 

• Using for personal purchases/sales. 

• Loss or theft of cryptocurrency. 

• Chain splits. 

• Use cryptocurrency in business. 
  

Capital Gains Tax (CGT) is generally the taxation that applies to cryptocurrencies. A CGT event occurs when you dispose of your cryptocurrency, which can occur when you: 

• sell or gift cryptocurrency 

• trade or exchange cryptocurrency (including the disposal of one cryptocurrency for another cryptocurrency) 

• convert cryptocurrency to fiat currency (a currency established by government regulation or law), such as Australian dollars, or 

• use cryptocurrency to obtain goods or services. 
  

Each cryptocurrency is considered as a separate asset.  

The ‘Cryptocurrency & Tax Explained’ link below provides and overview about how each of the above events is treated by the ATO, and how it can impact you. 

As the tax year end is approaching, have a chat to us about your cryptocurrency activity. The ATO is using data matching and has connections to many cryptocurrency trading platforms, so will likely be aware of any activity. We’ll help you work out the best approach for record keeping and determine tax implications, if any. 

For a clear and concise breakdown - Click this button to view PDF