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Re: Different cost in wallets

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Initiate

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Replies 5

Hi,

I have two questions.

1. I have sent an amount of 5 ETH made up from 9 different buys (at different costs) to my wallet from an exchange. I know that i can claim the fee as a deduction but how do I assign how much fee to each different amount?

2. When i send send this 5 ETH back or I sell some of it, how do i know which part i am selling? Do i just average out the cost of the 9 amounts and take the average? Or do i do something else?

 

 

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Best answer

Community Manager

Replies 1

Hi @Helen2 

 

If you separately obtain one kind of cryptocurrency, such as etherium, in separate transactions at different prices, the separate purchases are treated as different assets when you sell. So for example, in acquiring the 5 ETH this would be treated as 9 purchases at different costs.

 

You might have bought 1.4 ETH at a particular price and .8 ETH at a different price etc. If you decide to sell 1 ETH you can decide how much of the 9 purchases at different costs you are selling. In order to work out CGT on the sale of 1 ETH you subtract the costs of those portions of the 5 ETH that you have chosen to sell from the amount received. For example, you could decide to sell 1 ETH for $500 by selling .6 of that ETH that cost you $180 dollars and .4 of the ETH that cost you $100. Your total cost base for selling this 1 ETH would be $280 and then your capital gain would be $220.

 

The transaction cost you incurred in acquiring the 5 ETH would be capital costs of the purchase of the 9 ETH parts of the 5 ETH and would be added to the CGT cost base of the 9 items. The total cost of purchase needs to be allocated against the separate ‘purchases’ on a reasonable basis. For example, if you spent $100 of transaction costs in obtaining the 9 items of ETH, you could apportion the $100 to across the 9 ‘purchases’ in proportion to each such component of the 5 ETH obtained.

5 REPLIES 5
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Community Manager

Replies 0

Hi @Helen2,

 

We're going to look into this one for you.

 

Thanks, Nate

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Dynamo

Replies 1

@Helen2 you would need to apportion the fee. You need to decide what part you are selling. keep really good records. Look at these aricles on here. 

https://community.ato.gov.au/t5/Tax/How-do-I-calculate-capital-gains-tax-on-cryptocurrencies/ta-p/10...

 

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Initiate

Replies 0

Not sure how to do that but hopefully I can get it worked out. Thanks for taking the time to answer Smiley Happy

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Best answer

Community Manager

Replies 1

Hi @Helen2 

 

If you separately obtain one kind of cryptocurrency, such as etherium, in separate transactions at different prices, the separate purchases are treated as different assets when you sell. So for example, in acquiring the 5 ETH this would be treated as 9 purchases at different costs.

 

You might have bought 1.4 ETH at a particular price and .8 ETH at a different price etc. If you decide to sell 1 ETH you can decide how much of the 9 purchases at different costs you are selling. In order to work out CGT on the sale of 1 ETH you subtract the costs of those portions of the 5 ETH that you have chosen to sell from the amount received. For example, you could decide to sell 1 ETH for $500 by selling .6 of that ETH that cost you $180 dollars and .4 of the ETH that cost you $100. Your total cost base for selling this 1 ETH would be $280 and then your capital gain would be $220.

 

The transaction cost you incurred in acquiring the 5 ETH would be capital costs of the purchase of the 9 ETH parts of the 5 ETH and would be added to the CGT cost base of the 9 items. The total cost of purchase needs to be allocated against the separate ‘purchases’ on a reasonable basis. For example, if you spent $100 of transaction costs in obtaining the 9 items of ETH, you could apportion the $100 to across the 9 ‘purchases’ in proportion to each such component of the 5 ETH obtained.

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Initiate

Replies 0

Thank you. Hopefully I can make sense of all this.