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CGT Methods - Average, LIFO, etc

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For cryptocurrencies and other share trading, are we able to choose which method we use for calculating CGT? Eg. average cost, LIFO, FIFO...

 

The following extract looks like you can only use average cost if they were purchased on the same day - can someone please explain why it matters? Why cant I just use an average cost base for all the crypto tokens I purchased in the Financial year, and an average sell price for all my sales, and then carry the average cost base for any unsold tokens over to the next financial year?

 

From:

https://www.ato.gov.au/General/Capital-gains-tax/Shares,-units-and-similar-investments/Identifying-w... 

We'll also accept an average cost method to determine the cost of the shares disposed of if:

  • the shares are in the same company
  • the shares were acquired on the same day
  • the shares have identical rights and obligations
  • you're not required to use market value for cost base purposes.
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Hi @DallasE,


Thanks for your question!  As you can appreciate, these are complex topics; we can provide you with general information that may assist you in your situation.  You may find the personal investors guide to capital gain tax 2018 is a useful resource for you.


There are three methods for working out your capital gain or capital loss. You can choose the method that gives you the best result based on your circumstances – that is, the smallest capital gain. There is indexation method, discount method and the other method.


If you need further information, please contact our Early Engagement area, they can provide further advice on the complex issues based on your individual situation. There is a handy call back request form that you can complete, we are happy to work with you to resolve complex tax queries that you have been unable to resolve online.  A subject matter expert will call you back.

 

You can also phone us on 13 28 61, between 8am and 8pm, Monday to Friday.

 

I hope this helps, JodieM
 

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Devotee

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paying tax on crypto to fiat would be 8000% simpler and less destructive to the business of making money 

Best answer

ATO Certified

Community Support

Replies 1

Hi @DallasE,


Thanks for your question!  As you can appreciate, these are complex topics; we can provide you with general information that may assist you in your situation.  You may find the personal investors guide to capital gain tax 2018 is a useful resource for you.


There are three methods for working out your capital gain or capital loss. You can choose the method that gives you the best result based on your circumstances – that is, the smallest capital gain. There is indexation method, discount method and the other method.


If you need further information, please contact our Early Engagement area, they can provide further advice on the complex issues based on your individual situation. There is a handy call back request form that you can complete, we are happy to work with you to resolve complex tax queries that you have been unable to resolve online.  A subject matter expert will call you back.

 

You can also phone us on 13 28 61, between 8am and 8pm, Monday to Friday.

 

I hope this helps, JodieM
 

Devotee

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the 'other' method: https://www.ato.gov.au/general/capital-gains-tax/working-out-your-capital-gain-or-loss/working-out-y...

link has an extra https:// on the end, fyi anyone trying to access it just remove that

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