In Australia, cryptocurrency is treated as a Capital Gains Tax (CGT) asset. This means any profits from selling, trading, or exchanging cryptocurrency are subject to CGT. Whether you sell Bitcoin, Ethereum, or trade one crypto for another, these events are taxed similarly to property or shares.
If you hold your cryptocurrency for more than 12 months before selling, you’re entitled to a 50% discount on CGT, significantly reducing the tax payable. If you sell within 12 months, your profit is fully taxable at your marginal rate.
Cryptocurrency earned from mining or staking is classified as ordinary income, and must be declared on your tax return at the fair market value on the day it was received.
Expenses related to mining, staking, or maintaining your cryptocurrency portfolio, such as electricity costs and hardware, may be deductible if you’re running a business. Tax Avail helps track these expenses to ensure you maximize deductions.
If you’ve incurred losses from trading or holding cryptocurrency, those losses can offset other capital gains. Proper record-keeping of transactions and associated costs is essential for accurate reporting.