2025 Guide to Cryptocurrency Tax: Australia

With new reports suggesting one in three Australians holds some cryptocurrency in their portfolios, it’s clear residents see potential in assets like Bitcoin (BTC) and Ethereum (ETH). But the “currency” in cryptocurrency isn’t treated like the AUD or its fiat counterparts. The Australian Taxation Office (ATO) has clear and unique tax policies for this class of digital assets.

To remain compliant with the ATO, anyone who holds, trades, or earns cryptocurrency in Australia needs to know the tax consequences of their transactions. Read through this Australian cryptocurrency tax guide to better understand how to report Web3 activities and estimate tax liabilities accurately.

Is crypto taxable in Australia? 

In most cases, trading and earning crypto are taxable events in Australia. Cryptocurrency disposals – for another digital asset or a fiat currency – qualify as capital gains tax (CGT) events. If the sale price exceeds the cryptocurrency’s original purchase price, the disposal results in a capital gain, which may increase an Australian investor’s tax liability. However, when you earn crypto through activities like staking or airdrops, these rewards are treated as ordinary income.

There’s one key exception when the ATO doesn’t treat a crypto disposal as a taxable event: when someone uses their crypto as a personal use asset. These disposals occur when people buy and sell cryptocurrency solely to pay for a product or service, not as an investment. However, not every crypto sale for a good or service qualifies as personal use.

The ATO only considers disposal events for personal use if the taxpayer initially bought their cryptocurrency for less than $10,000 AUD. They also pay careful attention to the crypto asset's "main use" to determine the taxpayer’s intent and to see whether the purchase’s primary purpose was actually personal. Using crypto you’ve been holding for investment to purchase clothing doesn’t count as personal use, for example. For this reason, it’s essential to keep detailed records of every crypto transaction and use case to lodge your taxes correctly.

How much tax do you pay on crypto in Australia? 

Since crypto investments and disposals are taxed at your marginal income tax rate, the amount you owe depends on how much you traded and your taxable income. This rate ranges from 0% to 45%. 

A crypto disposal can result in a capital loss that offsets other capital gains for the year. If crypto investors lose money in a CGT event, they can deduct capital losses from their net capital gain for the year. The ATO also offers a 50% CGT discount if investors sell a long-term crypto position held for at least 12 months.

When and where do you pay crypto taxes in Australia?

The Australian tax year runs from 1 July to 30 June, meaning all crypto transactions in this period must be included in the year’s income tax return. The official deadline for lodging taxes as an individual is 31 October, but taxpayers may get extra time if they engage a registered tax agent by that date.

There aren’t special crypto tax rates or specific forms for reporting digital assets. Taxpayers must report crypto profits and income on Australia’s standard income tax form.

Who collects crypto taxes in Australia?

The ATO collects tax on cryptocurrency sales, just as it does on profits from assets like company shares. Aside from collecting a percentage on taxable crypto events, the ATO also obtains data on crypto transactions from Australian centralized exchanges (CEXs) as part of its data-matching program. Since ATO agents can access transaction data from these regulated exchanges, taxpayers must reconcile these records with their own transaction histories to lower the risk of discrepancies.

How are crypto gains taxed in Australia?

CGT on crypto gains is included in your assessable income and taxed at your marginal rate. Taxpayers add the proceeds from their yearly crypto activity to their total assessable income when determining their tax bracket and applicable rate. 

What’s the formula to calculate capital gains?

To calculate the capital gains from a crypto disposal, subtract the cryptocurrency's cost base from the capital proceeds. The cost base is what you originally paid for the asset, including associated costs, and the capital proceeds are the amount you receive when you dispose of it – either the AUD value of the sale or the fair market value (FMV) of another crypto asset received in an exchange.

Suppose a crypto investor bought one Ethereum for $2,500 and sold it for $4,000. The profit in this case is $1,500, which is included in their assessable income as a capital gain. 

Note that the ATO considers the acquisition date when calculating CGT eligibility for discounts. Anyone who holds a cryptocurrency for over 12 months qualifies for a 50% discount on their CGT gain. So, if the investor from the above example held their Ethereum for over a year before selling, their $1,500 profit would only add $750 to their assessable income.

What are the capital gains tax rates in Australia?

Taxpayers add their total crypto capital gains to their yearly income. Instead of recognizing CGT sales as separate taxable events, the ATO includes the net capital gain in a taxpayer’s assessable income, which is then taxed at their marginal rate. These percentages fluctuate, but there isn’t any crypto tax update anticipated until the 2026-27 tax season.

Here’s the current breakdown; all thresholds are in AUD:

Source: Tax Rates - Australian Resident

Which cost base methods can I use?

Subtracting a lump-sum purchase from one disposal is straightforward. However, when investors have multiple crypto transactions in a year, deciding which units count in CGT calculations is more complex. The ATO allows individual investors to choose a reasonable cost base method to determine which units are being disposed of, provided they can individually identify them. Allowable approaches include:

1. First In, First Out (FIFO): Also known as the “standard method,” this CGT calculation treats the earliest-purchased units of a cryptocurrency as the ones sold first. For example, if someone first bought Bitcoin for $50,000 and later bought additional units at different prices, their first Bitcoin sale would use the $50,000 value as the cost base.
2. Last In, First Out (LIFO): LIFO uses the most recently purchased cryptocurrencies as the cost base against disposals and works backward. So, if the same investor above bought one BTC for $50,000 and another for $75,000, their first sale would use $75,000 as the cost base.
3. Highest In, First Out (HIFO): Rather than focusing on the acquisition date, HIFO uses the highest purchase price as the first cost base for disposals. For instance, an investor who bought Ethereum for $3,500 and $4,500 would use the $4,500 as the cost base for their first disposal.

Investors may use more than one cost base calculation method for different assets in the same year. They may also change their chosen method in subsequent years.

Traders are generally restricted in the cost base calculation methods they may use. That said, as with investors, they may alter their chosen method from year to year.

Can I report crypto losses? 

If a crypto investor loses money on a trade, they can claim a capital loss to offset their capital gains and reduce their overall CGT liability. If capital losses exceed the taxpayer’s total capital gains, they can carry the unused losses forward to offset future capital gains. There is no time limit on this carry-forward under current ATO rules. However, losses from personal use asset transactions are nondeductible.

How should I report stolen or lost crypto?

The ATO recognizes cases where Australians lose access to digital assets (like a missing private key) or experience cybertheft. It's possible to claim a capital loss in these situations if you can prove you owned the crypto asset and that it is genuinely lost or stolen. The more documentation taxpayers can provide to build their case – including their wallet address linked to their identity, transaction history, and wallet creation date – the more likely the ATO is to accept their claim. Keeping clear documentation, whether through your own records or through an online crypto-tracking platform like CoinTracker, will make it easier to substantiate ownership and comply with ATO requirements.

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Which crypto transactions are taxable in Australia? 

There's no tax on activities like buying and holding cryptocurrency in an exchange account or personal wallet in Australia. It's only when users sell or swap their digital assets – or if they earn cryptocurrencies as income – that they must consider potential tax consequences.

When do I pay capital gains tax on cryptocurrency trading? 

As a rule of thumb, any crypto disposal not explicitly for personal use qualifies as a CGT event. While there are many specific instances in which a crypto sale could trigger tax, the ATO highlights several common scenarios.

Selling crypto for fiat

The most straightforward CGT event occurs when an investor exchanges cryptocurrency for fiat currency such as AUD. Taxpayers use the digital asset's market value at the time of sale, minus its cost base, to determine the taxable gain or loss. 

Swapping one crypto for another

Trading one crypto for another is also a taxable event in Australia. Taxpayers must calculate the FMV in AUD at the time of the exchange and subtract the cost base of the disposed crypto to determine the capital gain or capital loss.

Spending crypto on goods or services

Purchasing goods and services with crypto is also a CGT event, unless the ATO considers the crypto a personal use asset. To qualify, Australians need to buy and use their cryptocurrency on a product or service within a short timeframe. While the ATO doesn’t set a strict time limit, most examples involve transactions within a few days of acquisition.

The ATO also won’t consider instances where investors first transfer their crypto into another asset (e.g., fiat, gift cards, or prepaid debit cards) before purchasing a good or service as valid personal use assets.

Using crypto to buy NFTs

The ATO treats the purchase of a non-fungible token (NFT) using crypto as a disposal event for CGT purposes, much like swapping cryptocurrencies. Taxpayers must record the FMV of the cryptocurrency used to purchase an NFT, minus that cryptocurrency's cost base, to determine the tax implications. 

Gifting crypto

Sending Satoshis to friends or family isn't without its tax consequences. The ATO considers crypto gifts to be CGT events, unless you make a donation to an organisation with a deductible gift recipient (DGR) status. 

While the recipient doesn't pay tax on their gift, the sender must keep records of the transfer date, cost base, and FMV at the time of transfer for accurate reporting.

What’s considered taxable income?

CGT events are the most common reason for crypto taxation in Australia, but there are a few activities with tax implications that don't involve capital gains. As more Australians dabble in decentralized applications (dApps), the number of non-CGT events that taxpayers may need to include in their income tax return is growing. Here are a few examples of situations where dApp use creates assessable income in Australia: 

• Staking: Some blockchains use a proof-of-stake (PoS) algorithm that incentivizes users (often called forgers) to lock native cryptocurrency on-chain, securing the network and earning more coins. Australians who act as forgers may receive additional tokens as a reward for creating new blocks or holding their existing tokens. The FMV of these staking rewards is ordinary income at the time you receive them and must be declared on your tax return as “other income”. This amount also becomes the cost base when you later dispose of them.
• Mining: First introduced on Bitcoin, mining is part of another crypto consensus algorithm called proof of work (PoW), which uses computational power to validate transactions. Like the PoS model, nodes on PoW chains (miners) receive crypto rewards for their efforts. For most individual taxpayers, these mining rewards are assessable as ordinary income when received. If mining is conducted as a business, the crypto may be treated as trading stock.
• Airdrops: Unlike PoS or PoW rewards, airdrops are cryptocurrencies that blockchain or dApp companies give users to generate enthusiasm for a new project. If an airdrop token has monetary value, it is considered ordinary income when received by investors and must be reported as other income. If the airdropped tokens have no value when they launch, they don’t need to be declared as income. However, taxpayers must record a cost base of $0 for future disposals, which will be subject to CGT rules.
• Referral rewards: Some trading platforms offer crypto referral rewards or sign-up bonuses to attract more customers. If Australians take advantage of these promotions, they must include the money value of the crypto they receive in their ordinary income.
• Employee wages: Employees who receive part or all of their salary or wages in crypto must include the money value of those digital assets in their assessable income at the time of receipt. This amount becomes the cost base for those crypto assets when they are sold.

How is crypto taxed in DeFi?

Australia's tax treatment of decentralized finance (DeFi) activities can be complex and depends on the specific nature of each transaction. According to ATO guidance, transferring cryptocurrencies into DeFi protocols is a CGT event if there is a change in beneficial ownership, even if the user didn't technically sell their cryptocurrency. So DeFi activities such as depositing cryptocurrencies into liquidity pools, operating a crypto lending protocol, or exchanging a cryptocurrency for a wrapped token may all trigger a CGT event. 

On the other hand, earning interest, yield, or rewards through DeFi protocols is treated as ordinary income rather than a CGT event.

Because DeFi arrangements vary widely and the ATO’s view continues to evolve, it’s essential to keep detailed records of every transaction and stay up to date on the latest guidance. Working with a tax professional experienced in crypto taxation is recommended for anyone actively participating in DeFi.

Are there any other crypto taxes in Australia?

CGT events and income are the two primary ways the ATO taxes cryptocurrencies for individuals. Since 1 July 2017, digital currency has been treated the same as fiat currency for GST purposes, meaning that buying, selling, or using crypto as payment is not subject to GST.

However, GST-registered businesses may still have GST obligations if they accept cryptocurrency as payment for goods or services, or if they use crypto in their business activities.

Australia doesn’t have estate or inheritance taxes, so transferring cryptocurrencies to a beneficiary is not a taxable event. When the beneficiary later disposes of the inherited crypto, it will generally be subject to CGT, with the cost base determined as at the date of the original owner’s death.

Which crypto transactions are not taxable? 

Not all crypto transactions are taxable. If Australians don’t earn crypto as a reward or dispose of any cryptocurrencies, they generally won’t have to pay tax on their holdings.

Buying crypto with fiat 

Buying cryptocurrency with AUD is not a taxable event. However, these transactions are significant for future tax reporting, as they establish the cost base for your digital assets. Even though there are no immediate tax consequences, it’s still essential to record the details for every acquisition.

Holding crypto 

There are no taxes for simply holding cryptocurrency in a portfolio, whether it’s stored on an exchange or transferred to a self-custodial wallet. In fact, the ATO incentivizes long-term holders by offering a 50% discount on CGT for investors who hold cryptocurrencies for at least 12 months before disposal.

Transferring crypto between your own wallets 

Transferring cryptocurrency between wallets you own is not taxable. If you remain the legal owner of each wallet and don’t sell, trade, or use your digital assets to earn rewards like staking or interest income, there are no tax implications.

Donating crypto to DGR organisations

Donating crypto to a registered deductible gift recipient (DGR) organisation may entitle you to claim a tax deduction equal to the crypto’s market value at the time of the donation. However, donations made to organisations without DGR status are not deductible.

How do I report and lodge my 2025 crypto taxes in Australia?

Calculating crypto capital gains can make tax reporting more complex, but the ATO does not require any separate or crypto-specific tax forms. As long as you maintain accurate records of your transactions and know your yearly crypto-related capital gains and income, you have all you need to comply with the ATO's requirements. 

What tax forms do I need to lodge?

Since there is no crypto-specific tax form, taxpayers include their crypto capital gains and income in the ATO’s tax return for individuals (NAT 2541). While no separate documentation is required, it’s important to keep detailed transaction records to substantiate your calculations and reconcile potential discrepancies.

How do I lodge my tax return: DIY or CPA? 

The ATO offers a free online portal for Australians to lodge their tax returns, but you don’t have to go through this process alone. You may work with a registered tax agent or CPA if you prefer professional support.

Doing it yourself via myTax

The ATO's myTax portal, accessed through myGov account, lets you self-prepare and lodge your return online. After confirming your contact and financial information, you can check the boxes that are relevant to you, such as wage income, investment income, and deductions. Some boxes may be prepopulated if the ATO has data from an employer or a financial institution. Make sure to include all crypto-related capital gains and ordinary income. The software will automatically calculate your estimated refund or amount payable once all information is entered.

The ATO generally receives necessary tax information from businesses and other agencies by the end of July, so the agency doesn't recommend filing taxes sooner. The deadline for self-lodgment is 31 October. 

Hiring a registered tax agent

While not required, working with a CPA familiar with crypto tax rules may be beneficial for Australians with more complex crypto activity. They can help organize your records, ensure compliance with ATO requirements, and may also qualify you for an extended lodgment deadline, provided you’re on a registered tax agent's list by 31 October.

Australian crypto taxes in 2025: Simple and secure with CoinTracker

Keeping detailed transaction records is crucial for accurately filing crypto taxes. But as crypto investors get more involved with trading or passive income opportunities, manually accounting for every one of these activities while estimating the cost base can be a headache. 

With CoinTracker, you can automate this tedious transfer-tracking process. CoinTracker's Portfolio Tracker links to hundreds of exchange APIs, wallets, and blockchains to record and identify every crypto transaction. And with a CoinTracker account, users can also create compliant tax reports ready to ship to a CPA.

Tax time is approaching—are you prepared? Let us simplify your crypto tax journey. Create a free CoinTracker account and let our platform handle the complexities.

Disclaimer: This post is informational only and is not intended as tax advice. For tax advice, please consult a tax professional.