Australian crypto asset tax

Australian crypto asset tax

Reconcile the taxpayer's wallets and exchange accounts before calculating crypto income or capital gains. The tax treatment depends on ownership, the activity and the legal rights involved. Sources checked on 8 September 2026; draft ATO rulings are identified below.

Establish the activity and transaction history

Determine whether the taxpayer invests, carries on a trading or mining business, receives payment for services, or undertakes a separate profit-making transaction. Frequency alone does not settle that classification. Business trading stock and revenue gains require different calculations from capital investments.

• Records and reconciliation — Collect exchange exports, wallet addresses, transaction identifiers, timestamps, token quantities, fees and Australian dollar valuations. Match transfers between the taxpayer's own wallets to avoid recording them as sales or new purchases. Check that beneficial ownership really remains unchanged, particularly for exchange, lending and custody arrangements. Reconcile opening holdings plus receipts less disposals and fees to closing holdings. ([ATO: keeping crypto records](https://www.ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments/keeping-crypto-records))

Classify disposals and acquisitions

• CGT events on disposal — Selling crypto for money, swapping it for another token, giving it away or using it to buy goods can trigger a CGT event. A crypto-to-crypto swap generally creates a disposal of the token given up and an acquisition of the token received. Record both legs without inventing a second disposal of the newly acquired token.
• Proceeds, cost base and fees for investment assets — For investment assets, determine Australian dollar proceeds, the relevant parcel and adjusted cost base. Use actual fees and classify them by the transaction they relate to. A network fee is not automatically deductible or an addition to every asset's cost base. If parcel identification or an acquisition record is missing, investigate it; missing evidence does not establish a zero cost base. ([ATO: acquiring and disposing of crypto assets](https://www.ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments/transactions-acquiring-and-disposing-of-crypto-assets))
• CGT discount for individuals — Apply capital losses before any eligible discount. For ordinary eligible investment events before 1 July 2027, individuals can generally access the 50% discount after the required 12-month holding period. Companies cannot. Later events require the new CGT and transitional rules. % (individuals, ordinary eligible investment events before 1 July 2027, after 12-month holding period) ([ATO: CGT discount, 2026 tax reform Act](https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/cgt-discount))

Staking rewards and airdrops

• Staking rewards as ordinary income — Staking rewards are generally ordinary income at their Australian dollar value when received. Record that receipt and the cost base of the reward tokens so their later disposal can be calculated separately.
• Airdrop classification — An airdrop is not automatically ordinary income. Establish whether it was received in a crypto trading business, for goods or services, through another income-producing activity, or as a hobby receipt, gift or windfall. Current ATO guidance distinguishes these circumstances. Where the receipt is not ordinary income, the token can still be a CGT asset whose later disposal must be considered. ([ATO: staking rewards and airdrops, updated 19 August 2026](https://www.ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments/transactions-acquiring-and-disposing-of-crypto-assets/staking-rewards-and-airdrops))
• TR 2026/D1 draft ruling on airdrops — TR 2026/D1 is a draft ruling on airdrops. It expresses the Commissioner's preliminary view and has stated scope exclusions and proposed application arrangements. Do not describe it as a final ruling. For cost base, establish whether market value substitution applies and support the value at acquisition. An unavailable price feed is not evidence that a token had no value. ([TR 2026/D1](https://www.ato.gov.au/law/view/document?docid=DTR/TR2026D1/NAT/ATO/00001))

DeFi, wrapping and NFTs

• DeFi and wrapping mechanics — Read the protocol terms and transaction mechanics. Depositing assets in a liquidity pool, receiving a replacement token, lending, borrowing, wrapping or unwrapping may change or end rights even when the economic exposure seems unchanged. Record the assets and rights before and after the transaction. Relevant CGT events can include A1, C2, E2 or H2, depending on the arrangement. ([ATO: decentralised finance and wrapping crypto](https://www.ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments/decentralised-finance-and-wrapping-crypto))
• TD 2026/D2 on wrapping and unwrapping — TD 2026/D2 addresses specified smart contract wrapping and unwrapping arrangements and proposes C2 treatment. It is a draft, with exclusions. Do not apply it indiscriminately to every bridge or custodial transfer. Preserve a record of the arrangement and the interpretation used. ([TD 2026/D2](https://www.ato.gov.au/law/view/document?docid=DXT/TD2026D2/NAT/ATO/00001))
• NFT treatment — NFT treatment depends on what the token represents and how it is used. Business receipts, investment disposals, personal use assets and collectables require their own analysis. Neither the label NFT nor an exchange's tax category settles the result.

Personal use and missing assets

• Personal use exemption acquisition threshold — The personal use exemption requires the crypto to be kept or used mainly for personal use or consumption and acquired for less than $10,000. The threshold concerns acquisition cost, not sale proceeds. Spending a long-held investment on personal goods does not automatically convert it into a personal use asset. Capital losses on personal use assets are disregarded. AUD ([ATO: personal use crypto assets](https://www.ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments/crypto-asset-as-a-personal-use-asset))
• Lost access, theft and administration — Lost access, theft and an exchange entering administration need evidence of what asset or enforceable right remains and whether a loss event has occurred. Do not write off an account solely because withdrawals are suspended. Keep unresolved transactions outside the final calculation until their facts and treatment are documented, then reconcile income, gains, losses and holdings to the return workpapers.

Contributed by Ryan Duguid.