How is CGT applied to cryptocurrency and shares in Australia?

In Australia, cryptocurrency (such as Bitcoin, Ethereum, and other digital assets) and shares are both treated as CGT assets. Any profit you make from selling, swapping, or disposing of them may be subject to capital gains tax.

Cryptocurrency CGT events include:

• Selling crypto for Australian dollars or other fiat currency
• Swapping one cryptocurrency for another (for example, trading Bitcoin for Ethereum)
• Using crypto to purchase goods or services
• Gifting crypto to another person

Shares CGT events include:

• Selling shares on the stock exchange
• Transferring shares to another person
• Receiving a distribution from a managed fund that includes a capital gain

Calculating your gain or loss:

• Capital gain = disposal proceeds minus cost base (purchase price plus brokerage, exchange fees, and other acquisition costs)
• Capital loss = cost base exceeds disposal proceeds. Losses can be carried forward to offset future gains.
• If held for more than 12 months, the 50% CGT discount applies to the net gain

Important considerations:

• If you are a crypto or share trader (conducting business-like trading activities), your gains and losses may be treated as ordinary income under business rules, not CGT. The ATO looks at factors such as the volume and frequency of transactions, your intention, and whether you operate in a business-like manner.
• Personal use crypto (purchased for under A$10,000 and used to buy goods or services) may be exempt from CGT
• The ATO uses data matching programs with cryptocurrency exchanges and share registries. All disposals must be reported in your tax return.
• Keep detailed records of every transaction including dates, amounts, and fees