Jan 12, 2026 Emily Pell
Crypto & Compliance
Recent data from the Independent Reserve Cryptocurrency Index has shown that 31% of Australians own or owned crypto in 2025, an increase from 28% last year.
We have also seen crypto payments being more widely accepted as a form of payment for goods or services, and at times as a form of employment remuneration.
If you have interacted with cryptocurrency in any way or are interested in introducing it into your investment portfolio, it is crucial to understand the different tax implications that may apply according to the use of the cryptocurrency.
Investment
In most cases, cryptocurrency is acquired and held for some time to make a financial profit. This displays investment behavior, and a disposal of crypto in this scenario would trigger a capital gains tax (CGT) event.
As with other investments, if your crypto asset is held for longer than 12 months, the capital gains discount applies (50% discount for individuals and trusts, and 33% discount for super funds). Note that companies are not eligible for the capital gains discount.
Once there is a transfer of beneficial ownership in the crypto asset, a CGT event is triggered. This is important to note if you are considering transferring the crypto asset from one related entity to another.
Business activity
If you are transacting cryptocurrency in a more regular fashion and with profit-making intent, this demonstrates business activity.
In such cases, crypto assets are treated as trading stock for the business. Disposal of the crypto assets would be taxed as ordinary income, no different to selling physical stock in a business.
Personal use
Acquiring cryptocurrency and promptly using it to purchase items for personal consumption is mostly likely to indicate the cryptocurrency as a personal use asset.
Capital gains tax does not apply if crypto assets are acquired for less than $10,000 and used for personal purposes.
Remuneration
When cryptocurrency is provided as remuneration, it is taxed based on its market value at the time of payment.
Subsequent liquidation of the crypto asset, whether immediately or later, constitutes a CGT event. The market value at the time of remuneration will form your cost base.
The difference between the liquidation proceeds and the original cost base represents the capital gain or loss.
Keeping records
As with any investment or business activity, keeping good records of your cryptocurrency transactions is essential for meeting your tax obligations.
A list of records you should keep is detailed in this ATO guidance.
It is prudent to assume that the ATO’s data matching systems will detect any discrepancies between your tax return and the information reported from designated service providers.
Understanding your risk
Cryptocurrency investments are inherently volatile and currently lack comprehensive regulatory oversight, making them high-risk investments. It is important to understand the risk factors and seek financial advice on whether this investment aligns with your personal financial goals.
If you require assistance in evaluating whether cryptocurrency aligns with your investment strategy, or if you need further clarification regarding its tax treatment, please contact one of our experienced RDL advisors.
