Tax warning over crypto trades

If you’ve been trading in cryptocurrencies, the experience may sometimes seem a little surreal. But the Australian Tax Office (ATO) is warning us that this “internet money” is very real when it comes to tax time. 

It has been warning Australians that any profits or losses from the sale of crytpo between 1 July 2025 and 30 June 2026 must be declared in your tax return. 

Crypto may feel different, but the ATO generally treats it as a capital gains tax asset when held as an investment.  

For most older investors, the key question is not whether money has been transferred back into a bank account; it is whether you have disposed of crypto during the 2025–26 financial year. 

A disposal can include selling crypto, gifting it, swapping one coin or token for another, converting it to Australian dollars or another currency, or using it to buy goods or services.  

If you disposed of crypto, you need to work out whether you made a capital gain or capital loss. 

In simple terms, a capital gain occurs when what you received is more than what the asset cost you, including relevant costs. 

A capital loss can usually be used to reduce capital gains, but the ATO says a net capital loss cannot be deducted from other income such as salary, bank interest, or pension income.  

There may be good news for long-term holders. If you held the crypto asset for at least 12 months before disposing of it, you may be entitled to the capital gains tax discount, depending on your circumstances.