Crypto capital gains tax in Australia
Written by an ex-institutional trader. How the ATO applies capital gains tax to crypto: the events that trigger it, the 50 percent discount for holding over 12 months, how the cost base and gain are worked out (with an example), and how capital losses help.
Direct answer
In Australia, the ATO treats most crypto as a capital-gains-tax (CGT) asset, so you make a capital gain or loss whenever you dispose of it: selling for cash, swapping one coin for another, spending it, or gifting it. The gain is the disposal value minus your cost base (what you paid plus related costs). If you hold the asset for more than 12 months before disposing of it, individuals generally get a 50 percent CGT discount on the gain.
Capital losses can be offset against capital gains to reduce the tax, and unused losses carry forward to future years. The two points that trip people up are that swapping crypto-to-crypto is a taxable disposal (even with no cash involved), and that good records of every transaction's date, value and cost are essential. Crypto tax software automates most of this. This is general information, not tax advice, and the ATO crypto pages and a registered tax agent are the authoritative sources.
How CGT applies to crypto
In Australia, the ATO treats most cryptocurrency held by individuals as a capital-gains-tax (CGT) asset, similar to shares or property, rather than as money. That means you make a capital gain or loss each time you dispose of crypto, and the net gain for the year is added to your assessable income.
The important consequence: simply buying and holding crypto is not taxed. The tax event happens when you dispose of it. Understanding what counts as a disposal, and how the gain is calculated, is the whole of crypto CGT.
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What triggers a CGT event
A CGT event happens when you dispose of crypto. That includes:
- Selling crypto for Australian dollars (or any fiat currency).
- Swapping one crypto for another, for example Bitcoin for Ethereum. This is a disposal of the first coin even though no cash is involved, and it surprises many people.
- Spending crypto on goods or services.
- Gifting crypto to someone else.
What is not a CGT event: buying crypto with cash, holding it, or moving it between your own wallets. The crypto-to-crypto swap rule is the one to remember, because active traders rack up disposals every time they switch coins.
The 50% CGT discount
The single most valuable rule for crypto investors: if you are an individual and hold a crypto asset for more than 12 months before disposing of it, you generally get a 50 percent CGT discount, meaning only half the capital gain is taxed.
There is no separate crypto tax rate. The (discounted or full) net gain is added to your income and taxed at your marginal rate. So the holding period matters enormously: a gain on crypto held 13 months is taxed on half its value; the same gain on crypto held 11 months is taxed in full. This is why holding past the 12-month mark, where it suits your strategy, is the most common legitimate way to reduce crypto tax.
Working out the gain
The capital gain is the disposal proceeds (the Australian-dollar value you received) minus your cost base (what you paid to acquire and hold the crypto, including fees). A worked example:
| Step | Amount (AUD) |
|---|---|
| Bought 1 ETH (incl. fees) = cost base | $3,000 |
| Sold 1 ETH 14 months later = proceeds | $5,000 |
| Capital gain (proceeds - cost base) | $2,000 |
| Held over 12 months: 50% discount applies | -$1,000 |
| Taxable capital gain added to income | $1,000 |
That $1,000 is then taxed at your marginal rate. Had the ETH been held under 12 months, the full $2,000 would be taxable. Each parcel of crypto is tracked separately, which is where record-keeping (and software) earns its keep.
Capital losses
Not every disposal is a gain. A capital loss (disposing for less than the cost base) is useful: it offsets capital gains, including gains from other assets like shares, reducing your tax. If losses exceed gains in a year, the net loss carries forward indefinitely to offset future gains. It cannot be deducted against salary or other ordinary income.
Deliberately realising losses to offset gains, known as tax-loss harvesting, is a legitimate strategy and a common one near the end of the financial year. The ATO does have anti-avoidance rules against artificial wash sales (selling purely to crystallise a loss then immediately rebuying), so it needs to be done genuinely, ideally with advice. More on legitimate approaches in the how to reduce crypto tax guide.
Records and lodging
The ATO runs a data-matching program with Australian exchanges, so it often already has a record of your activity. Accurate records are not optional: for every transaction you need the date, the Australian-dollar value, the cost base, and the purpose.
Doing this by hand across hundreds of transactions is painful, which is why most active crypto users rely on crypto tax software that connects to exchanges and wallets and produces an ATO-ready report. The crypto tax in Australia pillar and the how to lodge crypto tax guide cover the full process. This page is general information, not tax advice; the ATO website and a registered tax agent are the authoritative sources.
Popular Australian crypto tax software
All three import from Australian exchanges and are free to start. General information, not tax advice.
General information only, not tax or financial advice. Verify with the ATO or a registered tax agent. Last reviewed: 2026-06-02.
Frequently asked questions
Do you pay capital gains tax on crypto in Australia?
Yes. The ATO treats most cryptocurrency held by individuals as a capital-gains-tax asset, not as currency. That means when you dispose of crypto, you make a capital gain or loss that goes in your tax return. Disposal includes selling crypto for Australian dollars, swapping one cryptocurrency for another, using crypto to buy goods or services, and gifting it. Simply buying and holding crypto is not a CGT event; the tax applies when you dispose of it.
How much capital gains tax do you pay on crypto?
There is no separate crypto tax rate. A net capital gain is added to your assessable income and taxed at your marginal income tax rate. The key lever is the 50 percent CGT discount: if you are an individual and hold the crypto for more than 12 months before disposing of it, only half the gain is taxed. So someone on a 37 percent marginal rate effectively pays about 18.5 percent on a discounted long-term gain, versus 37 percent on a gain from crypto held under 12 months.
Is swapping one crypto for another taxable in Australia?
Yes. Swapping one cryptocurrency for another, for example Bitcoin for Ethereum, is a disposal of the first coin and is a CGT event, even though no Australian dollars change hands. You work out the capital gain or loss based on the Australian-dollar market value of what you received at the time of the swap, compared with the cost base of what you gave up. This catches many people out, because it feels like just moving between coins, but the ATO treats each swap as a taxable disposal.
What is the cost base for crypto?
The cost base is generally what it cost you to acquire and hold the crypto: the purchase price plus incidental costs like brokerage or transaction fees. When you dispose of the crypto, you subtract the cost base from the disposal proceeds (the Australian-dollar value received) to work out the capital gain or loss. Keeping accurate records of the acquisition date, the amount paid, and the fees for every parcel of crypto is essential, because without the cost base you cannot correctly calculate, or substantiate, the gain.
What if I made a loss on crypto?
A capital loss on crypto can be used to offset capital gains, including gains from other assets like shares, which reduces the tax you pay. If your capital losses exceed your gains in a year, the net capital loss carries forward to offset gains in future years; it cannot be deducted against ordinary income like salary. Deliberately realising losses to offset gains is known as tax-loss harvesting and is a legitimate strategy, though the ATO has anti-avoidance rules against purely artificial wash-sale arrangements.
How does the ATO know about my crypto?
The ATO runs a data-matching program that collects information from Australian crypto exchanges, including identity details and transaction data, and matches it against tax returns. So the ATO often already has a record of your exchange activity. Not declaring crypto gains is therefore high-risk and can lead to penalties and interest. The sensible approach is to keep complete records, declare disposals accurately, and use crypto tax software or a registered tax agent if your activity is complex.
