TAX ESSENTIALS FOR CRYPTO INVESTORS • STEP 1 OF 4
Get Ready: Understanding Crypto Tax
The avoidance of taxes is the only intellectual pursuit that carries any reward.
— John Maynard Keynes
Learn which crypto transactions trigger capital gains tax and what records you must keep for the ATO.
Your Learning Journey
Your Learning Journey
This Step Takes: 20 minutes
Learn CGT events, the 12-month discount rule, record keeping requirements, and test your knowledge with scenarios.
Why This Matters
The ATO treats crypto like property. Every swap, sale, or spend is potentially taxable. Crypto investors who don't keep proper records face massive tax bills or ATO penalties. Get it right from the start.
Every crypto transaction may be taxable. Poor records = ATO penalties.
What Triggers a CGT Event?
Capital Gains Tax (CGT) applies when you dispose of crypto. Here are the most common triggers.
Selling for Fiat
Converting crypto to AUD, USD, or any fiat currency. This is the most obvious CGT event—you've realised a gain or loss.
Swapping Crypto
Trading BTC for ETH, or any crypto-to-crypto exchange. You dispose of one asset and acquire another. Both sides have tax implications.
Spending Crypto
Using crypto to buy goods or services. The ATO treats this as disposal. Exception: Personal use assets under $10,000 may be exempt.
Gifting Crypto
Giving crypto to someone (except your spouse) is a disposal. You use market value as the disposal price. The recipient's cost base is also market value.
DeFi & Staking Rewards
Staking rewards, liquidity mining, and yield farming are ordinary income (not CGT) when received. CGT applies when you later sell those rewards.
Airdrops & Forks
Airdrops and hard fork coins are ordinary income at market value when received. CGT applies when you dispose of them.
What's NOT a CGT Event
The 12-Month CGT Discount
Hold crypto for over 12 months and cut your taxable gain in half.
Held < 12 Months
Full capital gain is taxable
100%
of gain taxed
Example: $10k gain = $10k taxable
Held > 12 Months
50% CGT discount applies
50%
of gain taxed
Example: $10k gain = $5k taxable
Timing Matters
Personal Use Exception
Losses Offset Gains
What Records Must You Keep?
The ATO requires detailed records for every crypto transaction. No records = no deductions, and potential penalties.
Date & Time
Exact date and time of every transaction. Critical for determining the 12-month holding period.
Value in AUD
Market value in Australian dollars at the time of transaction. Use a reputable exchange rate source.
What You Acquired/Disposed
Type and quantity of crypto. For swaps, record both sides (what you gave up and what you received).
Transaction Fees
Exchange fees, network gas fees, and other costs. These add to your cost base and reduce capital gain.
Wallet Addresses
Source and destination wallet addresses. Helps prove ownership and track transfers between your own wallets.
Purpose of Transaction
Was it personal use, investment, or business? Affects CGT treatment and potential exemptions.
Use Tracking Tools
ATO Has Blockchain Data
Is This Taxable?
Test your understanding. For each scenario, decide if it's a taxable event.
Selling Bitcoin for AUD
Swapping Bitcoin for Ethereum
Transferring between your own wallets
Spending Bitcoin to buy a laptop
Receiving staking rewards
Receiving an airdrop
Tax-101 for Crypto - Get Ready: Complete
- Crypto is treated as property—selling, swapping, spending, and gifting all trigger CGT
- Hold for 12+ months to get a 50% CGT discount on capital gains
- Keep detailed records: date, AUD value, fees, wallet addresses, and transaction purpose
Homework
Have you been tracking your crypto transactions? If not, what's your plan to start?
Export your transaction history from every exchange and wallet you've used. Store it in a dedicated folder for tax time.
What's Next?
20 minutes