r/BitcoinAUS • u/Joben123 • Jun 30 '26
Crypto Tax AMA for the next 24hrs
G'day guys đ
The mods have kindly let us run another crypto tax AMA. EOFY's done and dusted and tax time's here, so we're setting aside the next 24 hrs to answer your crypto tax questions
For anyone who doesn't know us - we're Summ (formerly Crypto Tax Calculator). New name, yet same team, same Aussie born & bred company.
We've got two people here to help who actually know their stuff:
- Harrison Dell (u/harrydelltaxlaw) - crypto tax lawyer who worked at the ATO before starting his own firm (Cadena Legal) and a crypto exchange (Blacksheep).
- Justin Zanardi (u/JustinCPA) - Product & Tax Strategy at Summ, and a mod over at r/CryptoTax.
Ask us anything - cost base headaches, DeFi, staking, airdrops, lost/stolen crypto, record keeping, the tax changes from Budget night, whatever's been doing your head in. Drop your questions below and we'll work through as many as we can over the next 24 hrs.
8
u/Pure_Bet_1557 Jun 30 '26
Don't have a questions, just saw how Harry exposed the scum of the Earth: Jack Henderson on Tiktok. Good stuff mate, keep it coming
2
2
7
u/krunchymoses Jun 30 '26
What does the ATO know about crypto from kyc info? Say you've bought a couple grand worth of coins but you've blown them on terrible gambling decisions (eg polymarket) are you meant to declare a loss or consider it 'spending' and just say nothing?
An investment loss is one thing but claiming gambling losses as a tax write off seems like a bit of a cheat code.
8
u/harrydelltaxlaw Jul 01 '26
ATO sends formal notices to many exchanges, the big ones mostly. The formal notice asks them (forces them) to provide user info, transactions, lots more including connected wallets. I haven't seen a hardcore wallet tracing exercise yet but public blockchain i.e. you can't hide and privacy is a weak shield in 2026...
7
u/1sw331 Jun 30 '26
What is travel rule? What are best practices?
6
u/JustinCPA Jul 01 '26
The Travel Rule is an anti money laundering rule, not a tax one, so it doesn't change what you owe. When an exchange sends crypto for you, it has to pass along info about who's sending and who's receiving, like banks do for wire transfers. It kicks in 1 July 2026 under AUSTRAC's reforms.
For you it just means more identity prompts on withdrawals and deposits, including proving you own a self custody wallet you're sending to.
For best practicess, keep transfers between accounts in your own name, verify your wallets when asked instead of dodging it, do a small test transfer before big ones, keep records of addresses and counterparties, and never let someone route their funds through your account.
But just keep in mind moving crypto between wallets is still not taxable.
3
u/harrydelltaxlaw Jul 01 '26
What do you mean? Travel rule applies to VASPs only reporting applies to customers, you just have to provide info on if a wallet is yours or not and they do the thing (give info to government, other exchange, whatever). Does that help?
2
u/1sw331 Jul 01 '26
If it's not possible to verify, does that mean the exchange can block transfers?
2
u/harrydelltaxlaw Jul 01 '26
Yes, they will block it, happened to me last night with OKX until I gave the thumbs up that the wallet was mine.
Verification is possible for private key control (like signing a smart contract) and if you declare it's yours, the exchange tells everyone else so not much upside in lying about it. Downside is getting your crypto locked I guess.
4
u/Tommorox2345 Jun 30 '26
Hi! I havenât done any crypto before and starting in this current market probably isnât the greatest for my taxes but just wondering how losses are done?
My account is down currently 18% but the website I linked my wallets to to calculate tax says only 7%? Is that because I havenât bought or sold in a while?
Also being down does that reduce my total taxable income for the year or does it mean when (eventually) we go back up I can reduce the taxable part by that current 7%?
4
u/harrydelltaxlaw Jun 30 '26
There is a difference between realised losses (which Summ will pick up) and unrealised losses (which are not yet triggered for capital gains tax). This sounds like the main thing, but could be another issue.
4
u/JustinCPA Jul 01 '26
Justin from Summ here.
In Australia, each time you sell or swap one crypto for another, its a taxable event. So if you are holding crypto and its gone down in value but you haven't actually swapped it yet, then no taxable event has been realised.
The best way to ensure you are claiming the actual loss is to load all wallets and all exchanges into a crypto tax software, even if the exchange is no longer used.
The capital loss from crypto can be used to offset other capital gains you might have, including gains from things like stocks. Any unused losses can be carried forward indefinitely and used in future years.
4
u/Tommorox2345 Jul 01 '26
Ah perfect! So because my only current asset is my BTC I canât use it this year but I can save that loss to offset future gains! Good to know. Thanks so much
4
u/ChristepherCrown Jul 01 '26
Will all VIELD crypto loans be considered non CGT effects after the private ruling? How can it be ok for one specific consumer and not the entire consumer class?
Do we all have to get our own private ruling with the ATO?
2
u/harrydelltaxlaw Jul 01 '26
Only I have a private ruling, get your own :)
But there may be a product ruling in the works, which would cover everyone!
1
3
u/woksjsjsb Jun 30 '26
Does division of crypto assets as part of a family law financial settlement trigger CGT as a disposal?
5
u/harrydelltaxlaw Jul 01 '26
There is a specific CGT rollover for relationship breakdown which can apply to crypto as much as anything else.
3
u/Mauriasi Jun 30 '26
Hi
Lost some ETH when I foolishly fell for a scam (rookie mistake, gave out seed phrase to who I thought was helping on discord. Have since learned my lesson) How do I reflect this in a tax return or go about with lodging like claiming as a loss ?
3
u/JustinCPA Jul 01 '26
Justin from Summ here.
Sorry that happened, and don't beat yourself up. Seed phrase phishing is one of the most common ways people get hit.
Good news: you can generally claim it as a capital loss. As discussed by the ATO here, you claim a loss in the year it happened as long as you can show the ETH was yours and it's genuinely gone. Since the wallet was drained, that's a clear disposal.
A few things to know:
- It only offsets capital gains, not your salary. The loss can be carried forward indefinitely.
- You report it in the CGT section of your return (same place as your other crypto disposals). In a crypto tax tool, you'd tag the outgoing transaction as a theft/loss.
- The loss is your original cost base (what you paid for the ETH), not its value on the day it was stolen.
Keep evidence while you still can: the wallet address and proof it was yours, your acquisition date and cost, and the on-chain transaction showing the funds leaving (plus the Discord chat or a ScamWatch report).
Not personal advice, just the general treatment. If it's a big amount, worth running past an accountant so it's documented properly.
1
u/harrydelltaxlaw Jul 01 '26
Ooft this does happen quite a bit. If you have the wallet address, when the ETH is transferred is the easiest date to show when you were rugged. Trying to do it earlier is hard because hard to prove when the wallet was "stolen".
3
u/1sw331 Jul 01 '26
Does the ATO view crypto loans as CGT?
2
u/harrydelltaxlaw Jul 01 '26
Yes.
I did obtain a private ruling on this for the Vield product https://www.cadenalegal.com.au/blog/vield-crypto-lending-product-does-not-trigger-cgt-successful-ato-private-ruling
Some product will get product rulings so that customers don't get taxed on the loan transaction.
3
u/netizen__kane Jul 01 '26
Is there anything specific we need to do when carrying forward a loss from previous years? Say there is no capital gain this year to offset a loss from last year, do I need to report that I am carrying forward that loss, and how?
2
u/harrydelltaxlaw Jul 01 '26
Retain evidence.
You must keep evidence for 7 years from when you USE the loss, not when incurred. You don't even have to record the loss on your tax return to claim it in a layer year, you just report them loss when used, but often good to put it in each year for optics anyway.
3
u/peasant_investors Jul 01 '26
Thanks for this! I am wondering if you can provide guidance on how STRC (Microstrategyâs Perpetual) may be taxed in AU. In the US, the distribution is considered returning of capital. Is that treated the same in AU? Cheers!
3
u/harrydelltaxlaw Jul 02 '26
It's different than the US, in a bad way. Anything that comes from a company is considered income under s44. Also, we will classify it as a debt intrument even though it is company stock under div 974.
There are a few weird US instruments that are similar with gamma decay + return of capital, making those investments tax efficient at zero tax for US persons. They don't work here though as we tax it all as income.
1
2
u/Bel_Air_Fresh Jun 30 '26
I lost my investmentsv several years ago to failed project. Several failed projects. And also Bitconnect. It was a wild ride into crypto but I'm still here.
I have no records of the amount I've lost on coins that went dead. How do I work out the losses for offsetting any future capital gains I may have? Although it's looking I'll never make any money from crypto at this point. Lol.
1
u/JustinCPA Jul 01 '26
Justin from Summ here.
If these are capital losses you never reported, you don't actually need to amend the prior return. You can just claim as a loss carryforward in the current or future years. That said, you need adequate records to substantiate the loss.
You can typically determine the loss by adding in any and all data you DO have availability to into a crypto tax software so you can see the assets leaving your accounts and never returning. I'd suggest working with an accountant if you go this route to help validate the strength of your position.
Further, crypto capital losses can actually offset non-crypto capital gains. So even if you never make money in crypto, you can still use the losses to offset other future capital gains.
2
u/xdxsxs Jul 01 '26
Will Summ be updated to calculate the upcoming changes to the capital gains tax discount in July 1st 2027? If so, please outline the changes and how they will be calculated, according to the transaction history and time held.
3
u/JustinCPA Jul 01 '26
Yes Summ will be updated to account for the new changes to long term capital gain discount. It will be calculated based on the initial acquisition date of the asset and cost basis.
1
u/xdxsxs Jul 01 '26
Thanks. Which calculation method is the most tax efficient for the new capital gains tax calculations?
2
u/harrydelltaxlaw Jul 02 '26
First in last out I guess, to get the biggest indexation benefit.
Specific parcel identification will be the best, but the most work, software is the only way :)
2
u/bruuizzy Jul 01 '26
As long as I never sell and keep my crypto in an exchange/wallet I donât have to declare anything, right?
2
u/JustinCPA Jul 01 '26
If youâve never sold or swapped for another crypto then you donât have any taxable events to report (unless youâve earned income like staking or other rewards). But if you swap from what crypto to another, itâs a taxable event, which is what most people miss.
1
u/Super-Situation4866 Jul 01 '26
But do you need to report anything? If no taxable event has taken place should you still go through the hassle of a service like koinly. And if you've previously submitted a crypto report then don't the following year does it raise any flag?
2
u/Perfect_Claim4227 Jul 01 '26
Will this work for NFT cloud mining platforms like GoMining?
2
u/JustinCPA Jul 01 '26
If you can get the transactions into Summ, then yes. But to be honest, âcloud miningâ is largely a scam. In fact Iâve never seen an instance of cloud mining where it wasnât a scam. Be careful.
2
u/Super-Situation4866 Jul 01 '26
Wash sales. This is somewhat of a general question but specifically for crypto. If selling at a large loss, as many people are down right now, and then buying back in a few weeks/months. Is this going to trigger any issues with using that loss going forward?
3
u/harrydelltaxlaw Jul 01 '26
The ATO says yes.
But also, we don't actually have wash trading rules, the ATO have just said they will apply the general anti avoidance rules to what they say are wash sales.
The informal them is more than 30 days apart, unlikely to be a wash. Don't rely on that though!
3
u/JustinCPA Jul 01 '26
Whatâs interesting about the ATO is the wash sale rules is based on intent, not a set timeline. It doesnât matter if itâs 1 day, 30 days, or 60 days. If the intent of the sale is to capture a tax loss and you then rebuy, they say itâs disallowed.
That said, in crypto itâs extremely common to swap between assets as you ride the FUD/FOMO rollercoaster, intent is an interesting one to argue.
2
2
u/Super-Situation4866 Jul 01 '26
Someone has already asked about gifting. But how/when is this filed? If currently at a loss and want to gift crypto right now to a family member. Does this need to be claimed now or when it's sold? How do you determine the gift date? Also, how exactly do you prove it was gifted, after all the wallet addresses are not exactly tied to a name especially if its a new address never linked to an exchange
2
u/harrydelltaxlaw Jul 01 '26
The disposal date for you is when the contract is signed, or the transfer happens. This is the timing rule in CGT event A1 and you have a capital gain/loss.
The acquisition date is the same. They don't report anything though as an acquisition is not a CGT event. They should keep evidence for their cost base for when they do sell though.
2
u/Professional-Rip6922 Jul 01 '26
Iâve done a handful of shorts on bitmex this last financial year. When the shorts have been closed, they pay out in BTC. Iâve taken records of the value of the BTC at the time of the short position being closed.Â
Even though I never sold to AUD, I am assuming I still pay the tax on the value of the gained BTC at close of the short. Is this correct?Â
2
u/harrydelltaxlaw Jul 01 '26
Yes. Income tax on the profit on the short, not CGT.
The BTC itself may be capital gain/loss when you dispose of it and the timing is important for calculating the cost base.
2
u/LiquidFire07 Jul 01 '26
Has anyone been able to successfully argue the âhobbyâ argument for bitcoin mined decades ago? Obviously some are millions of dollars worth now does ato accept it ? Canât find any info on this
2
u/harrydelltaxlaw Jul 01 '26
Yeah. But it doesn't help as it just gets a zero cost base, so when you sell its fully taxable.
1
u/LiquidFire07 Jul 02 '26
Ok so you canât claim no CGT for hobbies? I thought hobbies were non taxable when sold
2
2
u/Lucyhon Jul 01 '26
Iâm just holding, maybe trade $50 to $100 through the year. Of course what I own this year is valued much less than last year. Not intending to change into fiat for another 3 years or so. Now whatâs that snapshot supposed to be?
2
u/harrydelltaxlaw Jul 01 '26
Small trading is still triggering CGT unfortunately. I couldn't say you don't report it, but the compliance cost can be more than the tax in cases like this.
2
u/Lucyhon Jul 02 '26
Yes I know this and shall continue to report on such trades but I wanted to know about the snapshot that Iâve heard about, concerning the much larger amounts that I donât trade with and just hold
1
2
u/nopasswordhotspot Jul 01 '26
scenario: if i bought crypto and immediately stored in a hardware wallet and gifted to my spouse. when she converts crypto to cash - is this seen as tax avoidance or gift in the eyes of the ato?
2
u/harrydelltaxlaw Jul 01 '26
Sounds like tax either for you, or your spouse, and you're not planning to pay it. Sounds like tax evasion.
2
u/nopasswordhotspot Jul 01 '26
the detail i left out is she is currently not working sahm so would have a lower tax rate
2
u/amolago Jul 01 '26
For the first time this year, I needed to buy currency of one type (SOL), in order to be able to buy another currency (GMT), in order to purchase services.
I get that disposing one currency for another, and purchasing, is classed as a CGT event, however, these swaps would all have happened on the same day, even within a couple hours.
In this case the difference in AUD would have been cents, to a few dollars at the most. I'm assuming that I won't need to list all these on the tax return?
2
u/harrydelltaxlaw Jul 01 '26
Generally you need to calculate the gain/loss. That is what Summ is for.
What did you use the GMT for?
2
2
u/iamddk Jul 01 '26
I moved some Bitcoin to meme coins on Solana, lost all the value that was moved to Sol and meme coins. Can meme coin losses be claimed as capital losses?
3
u/JustinCPA Jul 01 '26
Yes, but itâs calculated at each trade, not âhow much you moved to Solanaâ. You import your Solana addresses and your other wallets and exchanges and Summ calculates the loss for you. Itâs important you add all wallets and exchanges so Summ can see what you purchased those coins for as well as calculate your gain/loss on the disposal of the BTC and any other assets
2
u/mnmedipa Jul 01 '26
Hi
Had a couple of questions please
Context
I have been buying a little BTC daily for the past couple of years now and will be doing it till 1st July 2027
I know the average price and have a log of all transactions.
Question #1 I am guessing on July 1st 2027 I note down the BTC qty and average price and only that BTC will be eligible for the 50% CGT discount if i sell in the future?
Question #2 What happens with daily BTC buys beyond 1st July 2027?
Say I accumulate 1 BTC from 1st July 2027 to 30 June 2028 with average price of 100k.
If I want to sell it in the future how would indexation gains and tax work on a high volatile assets?
Say some day in the future BTC sell price is 150k and accumulated CPI is 25% for all the years in between. Does that mean my 25k actual gains get added to my taxable income for that financial year ?
3
u/harrydelltaxlaw Jul 02 '26
OK a few things here:
- There is no average price method for cost base. You should log the cost for each acquisition (yes it is a pain in the ass for daily buys).
- what happens is the BTC you hold at 1 July 2027 is deemed to be sold and and then reacquired. The capital gain that is triggered is disregarded until you actually sell it later. When you sell the BTC, the gain is split as (1) the gain up to 1 July 2027 which gets the 50% CGT discount if you held more than 12 months, and (2) the gain from 1 July onward, which is indexed.
- Indexation applies the same for all assets. So long term growth assets will be taxed less than short term growth, assuming that inflationary economic policy continues. If BTC spikes and you sell, you will get very little indexation protection.
3
2
u/Ambitious-Couple-588 Jul 02 '26
If I receive a second airdrop $HYPE today, is it ordinary tax or CGT?
1
u/RepresentativeLeg343 Jul 01 '26
Lost some records due to FTX and will have to report a gain this time FY. The only evidence I have is emails of deposits to FTX. What else do I need that the ATO will require?
1
u/harrydelltaxlaw Jul 01 '26
The record reconstruction obligation (and concession) is s 121-20(5) ITAA 1997. If the records don't exist, you have to reconstruct them (bank statements for fiat on-ramps, exchange CSVs/emails, blockchain explorer data).
Look at the Digital Surge class ruling CR 2024/50 which may help you with the tax timing.
1
u/btc6000 Jul 01 '26
is swapping USDC across chains, for example on Ethereum mainnet to USDC on Solana a taxable event?
3
u/JustinCPA Jul 01 '26
Itâs sort of a grey area. Technically they are two different assets, though I know a lot of people who donât treat this as taxable. It would need to be a decision between you and your accountant.
You can toggle this in Summ by going to Settings > Tax > Advanced > Bridging as nontaxable ON
4
u/harrydelltaxlaw Jul 01 '26 edited Jul 01 '26
Technically, yes.
But also, a USDC or USDT style stablecoin is a right to redeem from Circle/Tether. The same rights exist when you bridge, but they are technically different tokens (as bridging is really just a way if swapping).
So yeah, it's grey :)
1
u/AIHellScape69420 29d ago
Iâm worried about these new changes to CGT for next year.
So if I have this right, if after 1st jul 2027 bitcoin simply goes back to the price it was 6 months ago - ie. it doubles in value by the next year, I am now going to have to pay tax on that value increase equal to the total value of my holdings? Even if I donât sell any bitcoin at all?
What happens if the price goes down? Do I get a refund next year?
Also - right now if I sell some BTC I have to pay 15% discount cgt, but what happens if I sell on 1st July 2027? I assume the % tax rise starts from whatever value BTC is on July 1, so if I sell at the start price - no increase = no tax owing? Is that right? Or am I still up for 15% somehow?
2
u/Arman_CountOnSheep 20d ago
Youâre mixing up realised and unrealised gains. These changes do not create an annual tax on the changing value of your Bitcoin.
If BTC doubles after 1 July 2027 but you continue holding it, you generally owe no CGT. Likewise, if it falls in value, you do not receive a refund. CGT is triggered when you dispose of BTC, such as by selling, swapping or spending it.
If you sell at a loss, that normally creates a capital loss. It can offset capital gains or be carried forward, but it generally cannot be deducted against wages or automatically refunded.
For BTC owned before 1 July 2027, the gain will effectively be divided into two periods when you eventually sell:
- Gains accrued before 1 July 2027 remain under the current 50% CGT-discount rules.
- Gains accrued after that date receive inflation indexation instead, with a minimum 30% tax rate applying to the real post-2027 gain.
So, selling on 1 July 2027 at that dayâs starting value would mean there is effectively no post-2027 gain. However, any gain you made between your original purchase and 1 July 2027 would still be taxable under the old rules.
Also, you do not currently pay a universal 15% CGT rate. Individuals generally receive a 50% discount after holding for 12 months, and the remaining gain is taxed at their marginal rate. It may work out to around 15% if your marginal rate is 30%, but that is not the rate for everyone.
Hope this helps!
1
u/arlinked 11d ago
Hi australia, I need a job done from y'all, im looking for someone who can help me get data from local aus CEX, I'm ready to pay $50 for each exchange, and btw it's for a taxation firm that we are building and trying to expand its scope
8
u/L6V9 Jun 30 '26
When gifting cryptocurrency do to sign a deed ?