BOOK YOUR 2024 TAX RETURNS NOW!

ThePen-Logo-white-200

Can I claim my crypto losses?

There has been an update released by the ATO with further guidance for claiming your gains and losses from your cryptocurrency in your tax return.

The primary point to be aware of is that gains and losses from crypto are only reported in your tax return when you sell it, convert it to fiat currency, exchange it for another type of asset, buy something with it, essentially when you dispose of the cryptocurrency in any way. You cannot claim a loss or gain on market fluctuations. For the reason that the value of your cryptocurrency will continue to change up until the actual disposal. This is the point when your loss or gain is realised, on disposal.

This is when you are required to report your gains and losses for the year in your tax return.

You might be able to access the 50% Capital Gains Tax (CGT) discount and reduce the amount of tax you pay if you made a capital gain on cryptocurrency that has been held as an investment and you held the cryptocurrency for more than 12 months.

In contrast, if you made a capital loss from cryptocurrency, you can offset the loss against capital gains you have made (unless the crypto is for a personal use asset). You cannot offset your losses against other income such as, salary and wage. You can only offset this against your capital gains.

You must also report any form of income earned from crypto such as airdrops or staking rewards.

Remember, you must keep records of all your crypto transactions. It is crucial. The ATO uses advanced technology which tracks cryptocurrency trading and reporting. Where it is a focus area of the ATO’s and one you us get right.

Scroll to Top