How to work out and report CGT on crypto

When capital gains tax applies

The most common use of crypto is as an investment, in which case the crypto asset is a capital gains tax (CGT) asset.

If you acquire a crypto asset as an investment, transactions such as disposal or exchange or swap are a CGT event and you may make a:

• capital gain
• capital loss, which can reduce capital gains you make.

You can't deduct a net capital loss from your other income.

You may be able to reduce capital gains using the CGT discount if you hold your crypto asset for at least 12 months.

If you hold the crypto asset as an investment, it will not be exempt from CGT as a personal use asset.

To work out if you made a capital gain or capital loss from each CGT event, keep records for each crypto asset and your transactions.

You will make a capital gain if the proceeds from the disposal of your crypto asset is more than its cost base.

Working out the timing of the CGT event

In general, a CGT event happens when you dispose of a CGT asset. For the purposes of crypto assets, that may be when you:

• sell a crypto asset
• gift a crypto asset
• trade, exchange or swap one crypto asset for another
• convert a crypto asset to Australian or foreign currency
• buy goods or services with a crypto asset.

There are other CGT events, such as the loss or destruction of an asset, or creating contractual or other rights.

The type of CGT event that applies to your crypto asset transactions may affect:

• the time when the CGT event happens
• how you calculate your capital gain or loss.

Calculating your CGT

As with other CGT assets, if your crypto assets are held as an investment, you may pay tax on your net capital gains for the year. This is:

• your total capital gains
• less any capital losses
• less your entitlement to any CGT discount on your capital gains.

Before you calculate CGT on your crypto assets, you will need to:

• check you have records for your crypto assets and crypto transactions
• convert the value of the crypto assets into Australian dollars.

You need to keep details for each crypto asset as they are separate CGT assets.

You can work out your CGT using our online calculator and record keeping tool.

Report CGT on crypto assets in your tax return

If you are completing a tax return as or on behalf of an individual and lodging:

• online with myTax – refer to instructions, Capital gains or losses
• on a paper form – go to Part B – Instructions for individuals completing their tax return

If the tax return is for a company, trust or fund, go to Part C of the capital gains tax guide.

Our crypto asset data-matching program matches what you report in your tax return with data on crypto asset transactions and accounts from designated service providers. This helps us identify the buyers and sellers of crypto assets and quantify transactions.

How to work out and report capital gains tax (CGT) on transactions involving crypto assets.