I've created a program that automatically trades cryptocurrencies on a foreign exchange. No fiat currency (such as USD or AUD) is ever involved in the trading process and most of the cryptocurrencies cannot be evaluated in AUD. By buying low and selling high thousands of times a day, it ends up with more cryptocurrency. No Australian dollars are involved in the process, except for when I sell cryptocurrency such as Bitcoin of Ethereum via an Australian Exchange.
I found the following on the ATOs website:
"If you are not carrying on a business of bitcoin investment, you will not be assessed on any profits resulting from the sale or allowed any deductions for any losses made. However, if your transactions amount to a profit-making undertaking or plan then the profits on disposal of the bitcoin will be assessable income."
- https://www.ato.gov.au/General/Gen/Tax-treatment-of-crypto-currencies-in-Australia---specifically-bi...
Does this mean that I could treat the sale cryptocurrencies to AUD as a taxable income source?
If so, would I be able to negate profits with expenses backed up by invoices and records? For example, renting a high-end dedicated server to run the program may cost up to $4000 a year.
