Bought, sold, exchanged or swapped cryptocurrency this year? If you hold crypto as an investment, the Australian Taxation Office (ATO) generally treats your digital assets as capital gains tax (CGT) assets.
That means buying and selling crypto can have tax consequences, just like transactions involving shares or other investments.
Before lodging your tax return, here’s what individual crypto investors need to know about crypto tax in Australia.
Crypto is generally a CGT asset
For most individual investors, cryptocurrency is held as an investment and is therefore treated as a CGT asset.
This means transactions involving your crypto can trigger a CGT event, potentially resulting in a capital gain or capital loss.
CGT events can include:
- Selling cryptocurrency for Australian dollars.
- Exchanging one cryptocurrency for another.
- Swapping or disposing of a crypto asset.
- Using cryptocurrency to purchase goods or services.
If you acquire crypto as an investment, you generally cannot treat it as a personal use asset simply because you later use it to purchase something.
What about the personal use asset exemption?
The personal use asset rules can apply in limited circumstances where cryptocurrency is acquired and used mainly to purchase personal use items and the relevant requirements are met.
One important requirement is that the crypto asset must have been acquired for $10,000 or less.
If you’re holding crypto as an investment, the personal use asset exemption generally won’t apply.
How do you calculate a crypto capital gain or loss?
Broadly, you make a capital gain when the capital proceeds from disposing of your crypto asset are greater than its cost base.
You make a capital loss when the relevant capital proceeds are less than the cost base.
Because cryptocurrency transactions can be recorded in different currencies, you generally need to convert the relevant amounts into Australian dollars when calculating your capital gain or loss.
The exchange rate and valuation method used can therefore be important, particularly if you have traded on overseas platforms.
You may be entitled to the 50% CGT discount
If you are an individual investor and have held a crypto asset for at least 12 months, you may be eligible for the 50% CGT discount, provided the relevant requirements are met.
This can significantly reduce the taxable portion of a capital gain.
However, the discount doesn’t apply automatically to every crypto transaction, so it’s important to keep accurate acquisition and disposal dates.
What happens to crypto capital losses?
Crypto investments don’t always make money, but capital losses have specific tax treatment.
A net capital loss cannot generally be deducted from your other income, such as salary or wages.
Instead, a capital loss can generally be used to offset capital gains in the current income year or carried forward to offset eligible capital gains in future years.
Keeping accurate records of your losses is therefore important, even if you don’t have capital gains to offset in the current year.
Keep detailed crypto tax records
Good record keeping is essential when preparing your crypto tax return.
For each crypto asset and transaction, you should keep records such as:
- The date of the transaction.
- The type and quantity of cryptocurrency.
- The value in Australian dollars at the time of the transaction.
- The nature and purpose of the transaction.
- Details of the other party, where available.
- Wallet addresses and transaction IDs where relevant.
- Records from crypto exchanges and digital wallets.
If you have made hundreds or thousands of crypto transactions, reconstructing your transaction history at tax time can be particularly challenging.
Can the ATO see your crypto transactions?
Yes. The ATO has a crypto asset data-matching program that obtains information about crypto transactions and accounts from designated cryptocurrency service providers.
The ATO can use this information to help identify individuals who buy, sell and hold crypto assets and to compare transaction information with what is reported in tax returns.
Failing to report taxable crypto transactions can therefore create unnecessary risks, particularly where information held by the ATO does not match your tax return.
How do you report crypto on your tax return?
If you’re an individual lodging your tax return through myTax, you generally need to follow the current ATO instructions for reporting capital gains and losses.
Your tax treatment may be different if you are carrying on a business involving cryptocurrency or if your crypto activities involve more complex arrangements.
Companies, trusts and superannuation funds can also have different tax and reporting requirements.
What about staking, DeFi and other crypto activities?
Crypto tax can become complicated quickly.
In addition to straightforward purchases and sales, you may need to consider the tax treatment of:
- Crypto-to-crypto swaps.
- Staking rewards.
- Airdrops.
- Chain splits.
- Decentralised finance (DeFi) activities.
- Wrapped tokens and other digital assets.
The tax treatment can depend on the specific circumstances and the nature of the transaction.
Importantly, receiving a crypto asset may have tax consequences, and a later disposal of that asset can create a separate CGT event.
Talk to your tax adviser before lodging
If you’ve bought, sold or swapped cryptocurrency during the year, don’t assume your crypto activity is too small or too complicated to report.
Getting the crypto tax treatment right can help you meet your obligations while making sure you claim any available concessions correctly.
If you’re unsure how your cryptocurrency transactions should be treated, contact our office to review your position before lodging your tax return.
Published 11 September 2026