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how does CGT apply to cryptocurrency held for more than 2 years?

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i've held cryptocurrency for more than 2 years and was wondering how the profits from the sale of the security would be taxed?

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ATO Community Support

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Hi @bwubbq

 

When you sell/dispose/transfer or buy something with cryptocurrency, this is considered a transaction. Transacting with cryptocurrency may trigger a capital gains tax event. If this is reportable you will need to include the capital gain or loss on your tax return.

 

To calculate your capital gain from the sale of your cryptocurrency, there are three main steps:

Step 1 – Work out your cost base, this is usually your purchase price and expenses you incurred from owning the currency.

Step 2 – What was the amount (capital proceeds) you received for it when you sold/disposed/transferred/ or used it to purchase something else.

Step 3 – Subtract your cost base (Step 1) from the capital proceeds (step 2). This will be your total capital gain or loss.

 

If you held the cryptocurrency for longer than 12 months, you can apply the CGT discount after reporting the TOTAL capital gain amount to us. The discounted amount is reported at your NET capital gain label. This is also the figure we use when applying marginal tax rates.

 

Please use the links below for further information.

 

Links:

 

We hope this helps.

 

RichATO

 

 

 

1 REPLY 1

Most helpful response

ATO Certified Response

ATO Community Support

Replies 0

Hi @bwubbq

 

When you sell/dispose/transfer or buy something with cryptocurrency, this is considered a transaction. Transacting with cryptocurrency may trigger a capital gains tax event. If this is reportable you will need to include the capital gain or loss on your tax return.

 

To calculate your capital gain from the sale of your cryptocurrency, there are three main steps:

Step 1 – Work out your cost base, this is usually your purchase price and expenses you incurred from owning the currency.

Step 2 – What was the amount (capital proceeds) you received for it when you sold/disposed/transferred/ or used it to purchase something else.

Step 3 – Subtract your cost base (Step 1) from the capital proceeds (step 2). This will be your total capital gain or loss.

 

If you held the cryptocurrency for longer than 12 months, you can apply the CGT discount after reporting the TOTAL capital gain amount to us. The discounted amount is reported at your NET capital gain label. This is also the figure we use when applying marginal tax rates.

 

Please use the links below for further information.

 

Links:

 

We hope this helps.

 

RichATO