This crypto tax guide aims not only to help you understand the different sections of our Australian tax report but will also provide clear guidance on how to declare your crypto taxes to the ATO on your Annual Tax Return.
ACCOINTING.com Crypto Tax Report
ACCOINTING.com provides you with a tax report containing a summary of all tax-related cryptocurrency transactions for the selected tax year, in full compliance with ATO guidelines. It is available in both pdf and excel formats for convenience. First, let’s look at the ACCOINTING.com tax report and go through the different sections before delving into how to file your return.
First Page – Summary
- Contains a summary of your realized gains and losses, taxable income and fees for the tax year.
- For your convenience, the gains and losses have been broken out into short, and long-term, and your cost basis and proceeds totals are presented for each. You can find a summary by coin in the Taxable Disposals section and the full detail in the Tax Report Excel Version.
- Your taxable income totals by category are also presented. You can find the details behind these totals in the Taxable income – Detail page.
- Any fees that cannot be directly allocated to a specific asset will also be summarized for you. You can find the detail behind these fees in the Fees not included elsewhere – Detail pages.
Non Taxable Disposals & Income Page
- This page provides a summary of your nontaxable disposals and nontaxable income.
Taxable Disposals Page
- Lists a summary of your taxable sales or trades by coin. This will include all taxable sales or exchanges subject to capital gain taxes and will break out your gain or loss by coin, and indicate the short-term as well as the long-term portion. Please note that this is only a summary – for the full detail please see the Tax Report Excel File.
Taxable Income Page
- Provides your taxable income such as rewards, airdrops, mining, staking, interest, hard forks or similar types of income events. You can find the full detail in the Tax Report Excel File.
How to file your crypto taxes
In Australia, if you are filing a tax return as or on behalf of an individual, there are two ways to report crypto assets: online, through myTax, or via paper forms. Whatever method you use, the ACCOINTING.com report contains all of the information you need to file your taxes. All you need to know is where to enter those figures.
Filling Crypto Taxes with MyTax
A 10-step-by-step guide:
- On the my gov website, you can sign in to your ATO myTax account or set up a new one.
- Select “manage tax returns.”
- Select the option for 2021/2022 return.
- Verify that your personal and contact information is correct, then press “Next.”
- Now verify that your financial institution data is correct, and then press “Next.”
- Under the section titled “Personalize your 2021-22 return” section, provide your personal information as required.
- Depending on your crypto investments, you may need to select up to three options in this section:
- For crypto capital gains or losses, check the box next to “You had Australian interest or other Australian income or losses from investments or property.” Then, in the new drop-down menu, check the box next to “Capital gains or losses that are not from a managed fund.”
- If you had crypto income, check the box next to “Other income not listed above.”
- Finally, check the box next to “You had deductions you want to claim” and then check the box next to “Other deductions” from the new drop-down menu. Complete the rest of this section for yourself, and then click “Next.”
- Now on step 4 “Prepare your 2021-22 return” page:
- Start with the capital gains or losses by clicking “add/edit.” In the box under “Net capital gains,” copy and paste the figure under “Sum of total gain and loss” (if positive) on the first page of your ACCOINTING.COM report. Alternatively, if you have a capital loss for the year, enter this figure into the box under “Net capital loss carried forward to later income years.” For the question, have you applied an exemption, rollover, or additional discount, select “No.” Press save and continue.
- For crypto income, select add/edit next to other income. Next to “Any other income” select “add.” In the drop-down menu under “Type of payment” select “Other”. For the description, write the type of your crypto income – for example, crypto airdrop, mining, staking, etc. On the first page of your ACCOINTING.COM report, in the taxable income summary section, copy the figure next to the type of income you described and paste this into the amount box. Press save and continue.
- For deductions relating to crypto, select “add/edit” next to “Deductions.” Next to “Other deductions,” select “add.” Now, from the drop-down menu under “Type of deduction,” select “Deductions relating to financial investments.” Proceed by adding a description (i.e. margin fees). On the first page of your ACCOINTING.COM report, you’ll see a section titled “Fees not included elsewhere”, copy the figure next to the total. Again, these are fees that cannot be directly allocated to a specific asset. Press save.
- Complete the rest of your non-crypto-related tax return.
- Submit your return. You’re done!
Filling Crypto Taxes with Paper Forms
Alternatively, you can declare your crypto activity on paper and send the forms by mail. You will need two forms: one for capital gains and one for income.
- On your Tax Return for Individuals, select “YES” on question 1 of the Taxpayer’s declaration.
- On the Tax Return for Individuals (supplementary section), complete question 18:
- Enter the total amount of gains in the 18H “Total current year capital gains.”
- Enter the total capital loss in the 18V “NET capital losses carried forward to later income years.”
- The final amount is reported at the 18A “NET capital gain.”
Your crypto income is declared on question 2 of the Tax return for individuals 2022 (NAT 2541).
If your total capital gains or losses for the current year exceed $10,000, you must complete the capital gains tax (CGT) schedule.
The tax year in Australia runs from July 1 to June 30 of the following year. If you are an individual filing your own tax return for July 1, 2021 – June 30, 2022, the deadline is October 31, 2022.
If you hire a registered tax agent or accountant, they will generally have special lodgment schedules and can file returns for clients later than October 31. Speak to your tax advisor if you are unsure of your deadline.
The ATO is very clear in their guidance when they state that:
“You need to keep details for each crypto asset as they are separate CGT assets. Keeping good records is essential for meeting your tax obligations.”
We recommend keeping all of the following records indefinitely:
- Hot or cold crypto wallet addresses containing taxpayers’ crypto transactions
- Other records, such as transaction history files from exchanges (and wallets)
- Bank statements or other records showing the deposits and withdrawals of fiat currency
- Transaction history containing all of the following information:
- Type of crypto assets
- Date of every transaction
- Type of transaction
- Units of crypto and value in AUD at the time of the transaction
- The cumulative total of assets
Fortunately, all of this information will be automatically kept for you with Accointing.com. You should keep a copy of your tax report, all other files provided (such as the full data set), as well as a copy of any CSV or excel files uploaded to Accointing.com. If you’ve used any API and blockchain connections, keep the blockchain address and API keys. In the case you ever get audited, you want to be able to recreate the results.
The information contained in this guide is for general information purposes and does not constitute financial, investment, legal or tax advice. The present content is not intended as a thorough, in-depth analysis, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. Please consult your tax advisor.