How to Report Crypto Income in Australia

With cryptocurrency adoption surging, the Australian Taxation Office (ATO) is intensifying efforts to ensure investors properly report crypto income. Failing to declare crypto gains can lead to audits, penalties, and legal consequences. This comprehensive guide explains exactly how to report cryptocurrency income in Australia, covering tax obligations, calculation methods, and step-by-step filing instructions to keep you compliant.

What Qualifies as Taxable Crypto Income in Australia?

The ATO treats cryptocurrency as property, not currency. You must report:

• Trading profits: Gains from selling crypto for AUD or other assets
• Staking rewards: Income from proof-of-stake networks
• Airdrops & forks: Free tokens received (valued at market price)
• Crypto payments: For goods/services rendered
• DeFi earnings: Yield farming, liquidity mining, and lending interest
• NFT sales: Profits from non-fungible token transactions

Note: Buying crypto with AUD or transferring between wallets isn’t taxable. Only disposal events trigger obligations.

How to Calculate Crypto Capital Gains and Losses

Use this formula for each transaction:

Capital Gain = Disposal Price – Cost Base

Where Cost Base includes:

1. Original purchase price in AUD
2. Brokerage/exchange fees
3. Transaction costs (gas/network fees)

Important:

• Track every transaction date – holding assets over 12 months qualifies for 50% CGT discount
• Use FIFO (First-In-First-Out) method unless records support specific identification
• Offset capital losses against gains to reduce tax liability

Step-by-Step Guide to Reporting Crypto via myTax

1. Gather records: Export transaction history from exchanges/wallets
2. Calculate totals: Use crypto tax software (Koinly, CoinTracker) or spreadsheets
3. Log into myTax: Access via myGov account during tax season (July-Oct)
4. Select ‘Income’ section: Choose ‘Manage investments’ → ‘Cryptocurrencies’
5. Enter details: Report total capital gains/losses and other crypto income types separately
6. Submit: Review and lodge before October 31st

Pro Tip: The ATO receives bulk data from exchanges. Discrepancies trigger automated audits.

Essential Record-Keeping Requirements

Maintain these records for 5 years:

• Dates of all transactions
• AUD value at transaction time (use reputable exchange rates)
• Wallet/exchange addresses
• Purpose of transactions
• Receipts for hardware wallets or mining equipment

Use tools like ACrypto or CryptoTaxCalculator for automated tracking.

Deadlines and Penalties for Non-Compliance

• Deadline: October 31 following end of financial year (June 30)
• Late penalties: $222 per 28 days (up to $1,110) plus interest
• Intentional disregard: Penalties up to 75% of tax avoided + criminal charges

The ATO’s data-matching program has tracked 1.2M crypto users since 2019 – non-filers risk automated audits.

Frequently Asked Questions (FAQ)

Do I pay tax if I transfer crypto between wallets?

No – transfers between wallets you control aren’t disposals. Only report when selling, trading, or spending.

How is crypto taxed for businesses?

Businesses treat crypto as trading stock – profits are ordinary income (no CGT discount). GST applies to sales.

What if I lost money on crypto investments?

Report capital losses to offset future gains. Losses carry forward indefinitely but can’t offset salary income.

Are NFT sales taxable?

Yes – profits from NFT sales follow standard CGT rules. Minting costs form part of the cost base.

Can the ATO track my crypto?

Yes – they use blockchain analytics and data-sharing with exchanges like CoinSpot and Binance Australia.

How do I report DeFi transactions?

Each liquidity pool deposit/withdrawal and yield reward is a taxable event. Use specialized software for tracking.

Final Tip: Consult a crypto-savvy accountant if handling complex transactions like cross-chain swaps or derivatives. The ATO’s crypto guidelines are regularly updated – check their website for latest rulings.