Calculate Capital Gains Tax (CGT) for Australian investments with ATO compliance
Australia's Capital Gains Tax (CGT) system includes a 50% discount for assets held for 12 months or more. The Australian Taxation Office (ATO) has specific rules for different investment types, with increasing focus on cryptocurrency compliance.
CGT applies to most assets acquired after 19 September 1985. The tax is calculated on the capital gain, which is added to your assessable income and taxed at your marginal tax rate.
The ATO treats cryptocurrency as an asset for CGT purposes. Personal use asset exemption may apply for transactions under $10,000, but this is limited to personal use, not investment activities.
Having a Tax File Number (TFN) and properly reporting investment income provides significant advantages and is mandatory for Australian residents.
The ATO requires detailed records for all CGT events. For cryptocurrency, this includes transaction dates, amounts, exchange rates, and the purpose of each transaction.
Small businesses may be eligible for CGT concessions that can reduce or eliminate CGT on business assets, including the small business 15-year exemption and retirement exemption.
The ATO uses sophisticated data matching to identify unreported capital gains, including information from cryptocurrency exchanges, share registries, and financial institutions.
ATO Focus: The ATO has increased scrutiny on cryptocurrency transactions and investment income. Ensure you maintain detailed records and report all CGT events to avoid penalties and interest charges.
Individuals who hold an asset for 12 months or more are eligible for a 50% CGT discount. This means only half of the capital gain is included in your assessable income and taxed at your marginal rate.
The ATO receives data from cryptocurrency exchanges and uses data matching to identify unreported transactions. They can track transactions through blockchain analysis and exchange reporting.
Without a TFN, you may be subject to higher withholding tax rates (up to 47%) and won't be eligible for the CGT discount or other tax benefits. Australian residents are required to have a TFN.
No, capital losses can only be offset against capital gains, not other types of income like salary or business income. Unused capital losses can be carried forward indefinitely.
Your main residence is generally CGT-free. Investments in superannuation funds may have concessional CGT treatment. Some government bonds and certain small personal use assets under $10,000 may also be exempt.