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Bitcoin - tax on changing from one asset class to another

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Initiate

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Hello,

 

from what i undestand bitcoin is treated as an asset. If i use this asset to barter / trade to another asset such as gold / silver / realestate / vintage cars. does CGT still apply given it will solely be used as a differnt investment. Is there any other tax im unaware of when exchanging from one asset to another?

 

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Devotee Registered Tax Practitioner

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Its my understanding in-specie transfer or barter will still trigger a CGT event however the $10,000 PUA exemption may apply depending on your intention when you aquired the crypto (note the onus is on you to prove this intention).

If the crypto was orginally aquired for non investment purposes and cost less than $10,000 CGT would not apply any other circumstances it would.


I do not work for the ATO I am a tax agent who has been reseraching and investing in cryptocurrency for sometime 

3 REPLIES 3
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Best answer

Devotee Registered Tax Practitioner

Replies 2

Its my understanding in-specie transfer or barter will still trigger a CGT event however the $10,000 PUA exemption may apply depending on your intention when you aquired the crypto (note the onus is on you to prove this intention).

If the crypto was orginally aquired for non investment purposes and cost less than $10,000 CGT would not apply any other circumstances it would.


I do not work for the ATO I am a tax agent who has been reseraching and investing in cryptocurrency for sometime 

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Taxicorn

Replies 1

You may get away with swapping the bitcoin to say gold but when you eventually come to sell that gold it may be a "personal use asset' that cost more than $10,000 when you aquired it so you will then pay CGT on the sale of the gold.

 

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Initiate

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I could also be purchasing my main residence with bitcoin. I might have to contact a crypto specialist at the ato and ask for an official ruling.