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guy196(Initiate)Initiate
6 Dec 2023

To whom it may concern,

I have been living in Australia for the last few years on a student visa, and I have been investing in crypto during this time. I have a few questions:

  1. When the time comes for me to leave Australia and return to my home country, Israel (which is one of the 8 NDA countries for taxes in Australia), will I be required to sell all my cryptocurrencies to pay taxes on capital gains? Or is it possible for me to retain my crypto, report annually to the Australian ATO, and only pay taxes to Australia when I eventually sell my assets?
  2. If the latter option is feasible, is there a time limit for holding my cryptocurrencies? Do I need to pay taxes as long as I refrain from selling them, even if I intend to hold them for ever?
  3. I understand that Australian residents can benefit from a 50% reduction in capital gains tax if they wait for 12 months from the time of purchase to the time of sale. Does this same rule apply to student visa holders from NDA countries, such as Israel, who are considered Australian residents for tax purposes (as per the information in the following link: https://www.ato.gov.au/individuals-and-families/coming-to-australia-or-going-overseas/coming-to-australia/taxation-of-australian-resident-whms-from-nda-countries#WHMfromanNDAcountryandanAustralianreside)?
  4. If we are eligible for the 50% tax reduction, will it make any difference if I eventually sell my assets long after leaving Australia?

Thank you for your assistance.

Looking forward to your response,

Guy

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Most helpful reply

RileyATO(Community Moderator)Community Moderator
11 Dec 2023

Hi @guy196,

  1. No, you don’t have to sell your crypto assets when you leave Australia - but when your residency status changes a CGT event is triggered as if you did sell your assets.
  2. You’ll tell us about it in your tax return the year that your residency changes. After that you won’t need to report anything more to us.
  3. The same rules apply to all Australian tax residents.
  4. See 2.

All replies

Most helpful reply

RileyATO(Community Moderator)Community Moderator
11 Dec 2023

Hi @guy196,

  1. No, you don’t have to sell your crypto assets when you leave Australia - but when your residency status changes a CGT event is triggered as if you did sell your assets.
  2. You’ll tell us about it in your tax return the year that your residency changes. After that you won’t need to report anything more to us.
  3. The same rules apply to all Australian tax residents.
  4. See 2.

guy196(Initiate)Initiate
11 Dec 2023

I've got a bit confused after two calls to the ATO, where I got different answers. The reference number for one of the calls is 1052202476202. Can you help clear things up for me?

  1. Capital Gains Tax on Assets when Leaving Australia:
  2. In one call, I was told I don't need to sell or pay taxes on my capital gains when leaving Australia but should pay when I sell the assets. For example, if I bought Bitcoin for $1,000 and it's worth $2,000 when I leave, my profit on paper is $1,000. I understand I report this on the day I leave but pay taxes only when I sell. Is that right? If the Bitcoin is worth $4,000 when I sell, do I pay tax to the ATO only on the initial $1,000 profit and the rest to my new country?
  3. 50% Discount on Capital Gains Tax for Holding Assets Over 12 Months:
  4. I know about the 50% discount for holding assets for more than 12 months. But what if I hold them in Australia for over 12 months, leave, and then sell them? Do I still get the 50% discount for the time I held them while being a resident? It seems odd that I'd get the discount if I sell one day before leaving but not if I keep the same assets in Australia.

I'd appreciate your help in making sense of this. If you could also refer to the call with the reference number mentioned above, that would be great.

Thanks,

Guy

guy196(Initiate)Initiate
14 Dec 2023

Please answer my question:


I've got a bit confused after two calls to the ATO, where I got different answers. The reference number for one of the calls is [removed by moderator]. Can you help clear things up for me?

  1. Capital Gains Tax on Assets when Leaving Australia:
  2. In one call, I was told I don't need to sell or pay taxes on my capital gains when leaving Australia but should pay when I sell the assets. For example, if I bought Bitcoin for $1,000 and it's worth $2,000 when I leave, my profit on paper is $1,000. I understand I report this on the day I leave but pay taxes only when I sell. Is that right? If the Bitcoin is worth $4,000 when I sell, do I pay tax to the ATO only on the initial $1,000 profit and the rest to my new country?
  3. 50% Discount on Capital Gains Tax for Holding Assets Over 12 Months:
  4. I know about the 50% discount for holding assets for more than 12 months. But what if I hold them in Australia for over 12 months, leave, and then sell them? Do I still get the 50% discount for the time I held them while being a resident? It seems odd that I'd get the discount if I sell one day before leaving but not if I keep the same assets in Australia.

I'd appreciate your help in making sense of this. If you could also refer to the call with the reference number mentioned above, that would be great.

Thanks,

Guy

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