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Australian Tax Office Warns Crypto Investors on Capital Gains Obligations
The rate of capital gains tax on digital assets in Australia is determined by an investor's income tax rate.
Updated May 11, 2023, 4:24 p.m. Published May 16, 2022, 11:00 a.m.
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The Australian Taxation Office (ATO) has published a warning to cryptocurrency investors, reminding them that capital gains and losses must be reported every time a digital asset, which includes non-fungible tokens (NFT), is sold.
- In light of the recent downturn in the crypto market, ATO Assistant Commissioner Tim Loh said that "crypto losses can't be offset" against an investor's salary or wages.
- “Crypto is a popular type of asset, and we expect to see more capital gains or capital losses reported in tax returns this year,” said Loh.
- “Through our data collection processes, we know that many Aussies are buying, selling or exchanging digital coins and assets, so it’s important people understand what this means for their tax obligations,” Loh added.
- Australian citizens are not required to pay tax when purchasing cryptocurrencies, as long as the purchase is made with fiat currencies.
- Investors can get a 50% reduction in capital gains tax if they hold on to an asset for one year or more after purchase.
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