On May 16, 2022, the Australian Tax Office issued a publication that identified four key focus areas for the 2021-22 tax year. These four are areas where the ATO says they see people making mistakes. One of the areas is capital gains from crypto assets. The ATO plans to ensure that there is an appropriate level of scrutiny on correct reporting of deductions and income for the priority areas.
The ATO warned that taxpayers who dispose of crypto assets need to calculate a capital gain or capital loss and record it in their tax return. As with other capital assets, gain or loss is generally the difference between what an asset costs and what is received when it is disposed of.
Recognizing the recent volatility in the crypto markets, the ATO said that it expects to see more capital gains or capital losses reported in tax returns this year. The percentage owed to the ATO varies between income brackets and duration of ownership, but in general, the rate is reduced for assets held longer than 12 months. The ATO reminded taxpayers that crypto losses cannot be offset against salary and wages.
Author
David Zaslowsky
Email
David Zaslowsky is partner in the Litigation Department of Baker McKenzie's New York office. He helps companies solve complex commercial disputes in arbitration and litigation, especially those involving cross-border issues and Section 1782 discovery. David has a degree in computer science and, as a result, has worked on numerous technical-related disputes, including, most recently, those involving blockchain and artificial intelligence. In April 2025, Attorney Intel named David one of the top 25 blockchain lawyers in the country. He is the editor of the Firm's blockchain blog and co-editor of the firm's International Litigation & Arbitration Newsletter. David has been included for a number of years in the Chambers USA Guide and Chambers Global Guide for his expertise in international arbitration. He also sits as an arbitrator and is on the roster of arbitrators for a number of arbitral institutions. David sits on the Board and chairs the governance committee of the New York International Arbitration Center, and is a founding member of the International Arbitration Club of New York. For over 35 years, he has written and spoken often on the subjects of arbitration and international litigation.