Crypto tax basics — what the ATO expects

The Australian Taxation Office (ATO) treats cryptocurrency as a capital gains tax (CGT) asset, not as currency. This is a key starting point for understanding your tax obligations.

What this means in practice: every time you dispose of crypto—whether you sell it for AUD, trade it for another coin, or use it to buy something—you may trigger a CGT event. The ATO wants to know about these transactions, and you need to calculate any gain or loss.

If you hold crypto for 12 months or longer before selling, you may qualify for the CGT discount, which can reduce your taxable gain. However, this discount does not apply to all investors or all situations, so it's worth understanding the rules that apply to you.

The ATO expects you to keep detailed records of every transaction. This includes the date you bought, the AUD value at the time of purchase, the date you sold or disposed of the crypto, the AUD value at disposal, and the purpose of the transaction. If you're unclear on how to calculate the AUD value of a crypto purchase or sale, the ATO generally accepts prices from credible market data sources on the date of the transaction.

For most individuals who buy and hold crypto as an investment, CGT applies. If the ATO considers you to be running a business—for example, if you're trading frequently or mining crypto—different rules may apply, and your crypto income may be treated as ordinary income rather than CGT.

You'll report your CGT events and net capital gains (or losses) in your tax return through the ATO's myTax platform. If you've made a capital loss, you can carry that loss forward to offset future gains, but you cannot use it to reduce other income. Losses must be matched against gains from the same financial year or future years.

Staking rewards, airdrops, forks, and mining are also taxable events, though the rules differ from standard CGT. These are typically treated as income in the year you receive them, based on their AUD value at the time of receipt.