Cryptocurrencies are now being taxed. For Tax Time, the ATO will likely be in outreach mode, telling taxpayers that cryptocurrency activity has tax consequences, and warning of big penalties for non-disclosure.

If you are involved in acquiring or disposing of cryptocurrency, you need to be aware of the tax consequences. These vary depending on the nature of your circumstances.

Everybody involved in acquiring or disposing of cryptocurrency needs to keep records in relation to their cryptocurrency transactions.

Key Points to Remember

• Cryptocurrency is treated as property for tax purposes, not as currency
• If you hold cryptocurrency as an investment, you may be subject to Capital Gains Tax (CGT) when you dispose of it
• If you are carrying on a business involving cryptocurrency, gains are assessable as ordinary income
• You must keep records of all cryptocurrency transactions including dates, amounts, and the purpose of each transaction
• The ATO has data matching programs in place to identify taxpayers who have cryptocurrency but have not reported it

Contact Strategic Tax Accountants for expert advice on how to handle your cryptocurrency obligations.