Crypto Tax Australia: Crypto Capital Gains & Obligations for 2022

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Crypto tax in Australia can be complicated.  You should be aware of two key areas – your individual (or business) tax, and crypto capital gains tax obligations.  Understanding how these interact can help you avoid a lot of headaches and get on top of your crypto tax.  In simple terms, for crypto tax in Australia, the ATO does not consider cryptocurrency to be regular fiat currency.  Instead, cryptocurrency is usually treated and taxed like assets such as shares using the capital gains tax system.

In this article, we’ll break down each of the taxable events when it comes to crypto transactions. You’ll also know what you should be doing to accurately record these and how to access a crypto tax calculator. With this information you’ll know how to calculate cryptocurrency taxes and report them to the ATO.

What is Capital Gains Tax?

For most cryptocurrency transactions, capital gains tax will apply in some form.  But what is capital gains tax and how does it work?  Capital gains occur when a certain class of asset that you own, such as a cryptocurrency, shares, property, etc. increases in value and you make a profit when you dispose of it (e.g. sell/trade/etc.).  A capital loss occurs when the asset loses value and you sell for a loss.

How do I calculate Capital Gains or Losses?

When it comes to cryptocurrency, the amount you acquire the coin for (in AUD) is considered your cost base.  This includes any transaction fees from your exchange, gas for Ethereum transactions, etc.

When you dispose of your currency, the value of the coin at this point in time (in AUD) is your sale price.

Simply put, your capital gain or loss is calculated as:

Sale Price – Cost Base = Capital Gain/Loss

If you hold the cryptocurrency for more than 12 months, you can receive a 50% CGT discount if you’re an individual or trust.  Super funds may be eligible for a 33.3% discount, whilst companies are not eligible for a discount.

Crypto Capital Gains Crypto Tax Australia


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What are the different types of Crypto Capital Gains?

There are a variety of different situations for the acquisition and disposal of cryptocurrency that CGT rules can apply to.  Let’s break them down for you so you know how to classify and report your crypto tax in Australia.

Selling crypto

When you sell your crypto, CGT rules apply where you must calculate the difference between your buying and selling price.  You declare this difference as a capital gain or loss on your tax return.

Trading or swapping cryptocurrencies

Some people like to use their cryptocurrency holdings to purchase different cryptocurrencies.  Trading one cryptocurrency for another is classified as a disposal, and you are required to pay CGT on it.

For example,

When exchanging Bitcoin for Ethereum, your cost base is your BTC purchase price, and your BTC sale price would be its AUD value at the time you exchanged your coin for ETH.  If you then proceed to dispose of the ETH, you would again have to pay crypto capital gains based on the AUD amounts of when you obtained the coin and disposed of it.

Trading stablecoins

The ATO treats stablecoins such as Tether (USDT) as regular cryptocurrency, meaning the same CGT rules for the disposal of crypto apply.

Cryptocurrency gifts

Sending cryptocurrency to another person is classified as a disposal.  So yes, you will also have to pay CGT based on your AUD cost price and the AUD value at the time of gifting the cryptocurrency.

When you receive a cryptocurrency, you do not incur a taxable event.  However, you should record the AUD value of the coin at the time you receive it.

When you dispose of the coin you will need to pay crypto capital gains tax based on this value and the AUD sale price.

For example, you receive 1 ETH valued at $3,500 AUD on your birthday.  1 month later you sell it for $4,000 AUD. The capital gain you made on this crypto sale is $500, which you will report on your tax return.

Crypto Gifting


In Australia, the ATO has provided broad guidelines on the tax treatment of NFTs depending on their use case. Depending on how you are using NFTs you can pay tax according the the method that best suits your use case:

  • under the capital gains tax (CGT) regime
  • on revenue account as trading stock
  • as part of a business or profit-making scheme
  • or depending on the terms of the NFT smart contract and the rights it grants, a combination of the above.

In general for most users who are buying or selling NFTs, you will treat NFTs in the same manner as normal cryptocurrency as they fall under the same rules for Crypto assets and Capital Gains.  The following actions with NFTs are considered disposals and will trigger CGT events:

  • Selling NFT’s in exchange for cryptocurrency
  • Exchanging one NFT for another NFT or fungible cryptocurrency
  • Giving a NFT as a gift (unless it is to a tax deductible entity such as an Australian charity)

The minting of an NFT is generally not a taxable event.  It’s only the disposal of the non-fungible token (such as through sale, trade or bridging) that constitutes a CGT event.  The exception is when the value of the asset the NFT is minted for increases since the original purchase, which would constitute a CGT event.

However, if you are an artist generating NFTs, they may be considered as a business operation, and the minting of the NFT could potentially be treated as business income and applicable for tax. In this case, it would be best to speak to an accountant to discuss your tax obligations.

Forks or Chain Splits

When a cryptocurrency blockchain forks, there are two types of taxable outcomes.

The original blockchain is still active – both chains moving forward will carry forward balance.

  • Forked coins will have a cost base of zero and you’ll be liable for capital gains when you dispose of them.
  • For example, in 2017 with Bitcoin Cash forked from Bitcoin (the original blockchain).  If you held Bitcoin e.g. 5 Bitcoin during the fork, you would have received an equivalent amount of Bitcoin Cash.  This Bitcoin Cash would have a cost base of zero and you would only pay capital gains tax on it when you dispose of it.

The original blockchain is abandoned – the original coin is removed from circulation with two coins replacing it.

  • The fork results in two completely different blockchains.  The original blockchains coins will be considered disposed of and you’ll be liable for CGT on their value at the time of the blockchains abandonment.
  • The two new cryptocurrencies you receive out of this will have a cost base of zero and you will only pay capital gains tax on them when you dispose of them.
  • For example in 2018, the Bitcoin Cash blockchain was abandoned and Bitcoin Cash ABC and Bitcoin Cash SV forked from it.  If you held Bitcoin Cash of a value of $1000 AUD at this date, you would have to report a capital loss of $1000 on your tax return for that financial year.


Mining is treated differently based on whether you mine as a hobby or as a business

As a hobby miner, CGT will apply when you dispose of the cryptocurrency.  However as you did not purchase the coins and instead generated them through computational power, your cost-base is zero and your crypto capital gains are simply the AUD amount you sell your currency for.

The distinction between what is considered hobby mining and business mining is not always clear.  For more information see our dedicated article.

Crypto Mining

When is cryptocurrency considered Income Tax?


Airdrops function differently to the purchase of cryptocurrency.  When you receive an airdrop, you should record the AUD value at the time of this drop as you will have two obligations:

  1. You must declare the value of this airdrop as an addition to your taxable income on your tax return for that financial year.
  2. Crypto capital gains tax will apply when you dispose of the coin.


Staking a blockchain network like Ethereum is usually treated like interest on a bank deposit.  With a bank deposit, you are locking up your assets and receive a payout at certain points in time; in the case of staking a blockchain, you receive a reward when the pool reaches a consensus.

When you stake a network it is important to record the value of any staking rewards at the moment you receive them. This is treated as ordinary income and added to your taxable income, like the interest your receive from a bank deposit.

You won’t pay any Capital Gains tax until you dispose of what you received as a staking reward.  At this point, you’ll calculate the difference in price between the initial price of the staking reward and the price you sell it at to determine the amount you’ll report as Capital Gains on your tax return.  If you hold your staking rewards for more than 12 months, you’ll be eligible for the 50% CGT discount.


Mining is treated differently based on whether you mine as a hobby or as a business

If you are classified as a crypto mining business, you will not pay CGT, instead the AUD value of the cryptocurrency as you obtain it will be classified as taxable income.  As you are being treated as a business, you’ll be taxed at the business tax rate 27.5-30%.  You have several obligations:

  1. You must record the AUD value of each cryptocurrency payment when you receive it.
  2. The AUD amount when you dispose of your coin is considered taxable income.  This is in addition to the initial AUD value declared on your business’ income.  But why is this the case?  This is because you’ll be able to dispose of the coin at any time without being required to pay CGT or benefit from the 50% CGT discount.
  3. You must declare the change in value of your portfolio at the end of financial year.  Any gain in value is added to your business’ taxable income, whilst any loss is an allowable deduction.

For more information on crypto mining tax obligations for individuals and businesses, see our full article.

Due to the large number of transactions that can occur whilst mining cryptocurrency and the complicated nature of the taxation system, it’s recommended that you engage the services of a crypto tax calculation and reporting service such as CryptoTaxCalculator or speak to a qualified accountant at POP to ensure you’re meeting your tax obligations.

Wages from work

If your employer pays you in cryptocurrency, you will have two key obligations to keep track of:

  1. The AUD value of the cryptocurrency on the date you receive it.  This will be considered taxable income and will need to be reported on your tax return.
  2. The AUD value when you dispose of the cryptocurrency. You will need to pay Capital Gains Tax on the difference between these two values.

Employers will need to meet their PAYG obligations on the AUD value of the cryptocurrency at the point that they paid you with it.  The ATO states:

In the absence of a valid salary sacrifice agreement, the employee is considered to have derived their normal salary or wages and the employer will need to meet their pay as you go (PAYG) obligations on the Australian dollar value of the cryptocurrency it pays to the employee.

It is highly recommended that you consult with an accountant before agreeing to receive wages or pay an employee in the form of cryptocurrency so you are aware of all the pros, cons and tax obligations.

Tax-Free Cryptocurrency – Are there any CGT Exemptions?

So we’ve just covered a lot of ways in which you can be liable for capital gains crypto tax in Australia.  You’re probably wondering if there is anything that doesn’t involve paying a crypto capital gains tax.  There are a few exemptions which we’ll outline now.

Buying Crypto

As an individual when you purchase cryptocurrency, you do not have to pay tax until you dispose of it.  This means as long as you hold your investment, you won’t have to pay CGT on it.  When you hold for over 12 months and then dispose of your crypto, you’ll be able to obtain a 50% on your CGT.

Crypto Buying

Personal Use Assets

You can use cryptocurrency to purchase goods or services for personal consumption without being liable for CGT.  This could include purchasing goods from a retailer who accepts cryptocurrency.  However, there are a couple of restrictions when it comes to personal use assets.

Firstly, there’s a limit on the value of goods considered for personal use.  You can only purchase goods below a value of $10,000 AUD.

    • This means if you wanted to purchase a car valued over $10,000 with Bitcoin, you wouldn’t be exempt from crypto capital gains tax.
    • This transaction would still be considered a disposal and you would have to perform the usual sale price – cost price calculations.

Cryptocurrencies are not considered personal use assets if you are keeping them as an investment, using them to make profit, or as part of running a business.  Additionally, the longer you hold the cryptocurrency, the less likely the ATO will consider it as personal use.

    • In order to classify as personal use, the purchase of the cryptocurrency must be performed relatively shortly before the purchase of the good.  Generally this should be done on the same day, as due to the volatility of cryptocurrencies the value may change significantly over the course of a few hours or days, resulting in a capital gain or loss.
    • If you acquired cryptocurrency for investment purposes and then subsequently used it to pay for goods and services, this would instead classify as disposal of the cryptocurrency and therefore be liable for GST.

The classification of personal use assets by the ATO is one of the less clearly defined areas of crypto tax in Australia. If your use case is not clearly defined by another activity, it will often come down to making a judgement with your accountant or applying for a Private Ruling from the ATO.


Donating cryptocurrency is a tax-free event and is even allowed as a tax deduction.  To calculate your deduction, you’d still perform your capital gain/loss calculation based on AUD price on purchase and donation date.  However, you’ll be reporting this value as a deduction on your tax return.

Lost or Stolen Cryptocurrency

If you lose access to your cryptocurrency or if it is stolen, you can potentially claim it as a capital loss.  This is based around whether the amount can be replaced.  For example if an exchange was hacked, but you are being refunded/reimbursed by the exchange you can’t claim a capital loss.  However if your private wallet key is lost, then you potentially could.  You will need to provide evidence to support any capital loss claim.  See the ATO guide for more information.

Record Keeping

To accurately report your crypto tax in Australia, you need to be keeping accurate records of your transitions. This applies, whether you’re buying, selling, trading, mining, etc.  The ATO requires that you record:

  • The date of the transaction
  • The AUD value of the cryptocurrency at the time of the transaction
  • The purpose of the transaction e.g. purchase, trade, gift, mining payment, etc.
  • Who the other entity involved in the transaction was e.g. your exchange, trading platform, person.  At a minimum this could just be their cryptocurrency address.
  • The receipts of purchase/transfer of your cryptocurrency
  • Exchange records, e.g. CSVs
  • Records of agents, accountants, and legal costs
  • Digital wallet records and keys
  • Software costs related to your tax affairs.  E.g. accounting software such as Xero

Need help with your Crypto Tax in Australia?

Crypto tax sure is complicated isn’t it? If you need a hand sorting out your crypto taxes, get in touch with us today.  We offer crypto tax returns for individuals and businesses and ensure accurate ATO crypto tax compliance with through our partnership with Crypto Tax Calculator and their advanced reporting software.

With how rapidly the crypto industry is evolving, sometimes you may find the guidelines in the ATO’s crypto tax legislation doesn’t quite fit the use case or intent behind your activities, particularly if you are operating on the bleeding edge. In this case, it’s best to speak with an accountant to examine what aspects of the current guidelines best define your activities and potentially contact the ATO for a Private Ruling.

If you want some more detailed information on specific types of cryptocurrency transactions and their tax implications, check out CryptoTaxCalculator’s 2021 guide to Australian Crypto Taxes.

Crypto tax accountants

Crypto Tax Returns

Get in touch to start lodging your Crypto Tax Return with
POP Business or call 1300 180 630 to speak to one of our consultants.

The information provided in this article is general in nature and is not tax, accounting or legal advice. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this information, you should consider the appropriateness of the information having regard to your own objectives, financial situation and needs and seek the professional advice of an accountant or qualified financial advisor.

POP PTY LTD (POP Business & POP Tax) disclaims all and any guarantees, undertakings and warranties, expressed or implied, and is not liable for any loss or damage whatsoever (including human or computer error, negligent or otherwise, or incidental or Consequential Loss or damage) arising out of, or in connection with, any use or reliance on the information or advice in this article. The user must accept sole responsibility associated with the use of the material on this site, irrespective of the purpose for which such use or results are applied. The information on this website is no substitute for specialist advice.

Picture of Sidney Cachuela

Sidney Cachuela

I am a business mentor, an associate financial advisor and one of the co-founders at POP that genuinely revels in solving complex problems that businesses face. I’ve worked with high profile wealth managers, financial advisors and business owners to drive innovation and achieve success. My expertise includes helping small businesses with a range of accounting services, including: financial advice, accounting and bookkeeping, GST tax planning, as well as company, trust and partnership tax returns and more.

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