Cryptocurrency and taxation of winnings
Cryptocurrency and taxation of winnings
Current on: 11 August 2025
Short conclusion
In Australia, cryptocurrency is treated as property rather than currency. Winnings received in digital assets are subject to taxation according to the rules depending on the status of the player (amateur or professional) and the nature of the operation.
1. Legal status of cryptocurrency in Australia
Regulated by the Australian Taxation Office (ATO).
Classified as Capital Gains Tax (CGT) asset.
Any cryptocurrency transaction (sale, exchange, conversion) can trigger a tax event.
2. Taxes for gambling enthusiasts
The very fact of winning cryptocurrency from playing in a casino or betting is not subject to income tax.
The tax arises when cryptocurrency is sold or exchanged for fiat or other cryptocurrency.
Capital Gains Tax is applied when the value increases from the moment of winning to the moment of sale.
3. Taxes for professional players
Cryptocurrency winnings are considered business income.
Profit is subject to income tax at rates for individuals or companies.
Ability to account for game-related expenses in tax deductions.
4. AUSTRAC Role and Operations Control
Large transactions are captured and verified.
Transfers to fiat through licensed exchanges are transferred to AUSTRAC.
If money laundering is suspected, transactions may be frozen until the circumstances are clarified.
5. Procedure for calculating tax when selling winnings in cryptocurrency
1. Determine the market value of the asset at the time of winning.
2. Determine the sale or exchange price.
3. Difference between the sale price and the value at the time of winning = CGT taxable base.
4. If the asset has been held for more than 12 months, a CGT discount of up to 50% (for individuals) may apply.
6. Examples
The amateur won 2 BTC and immediately exchanged for AUD - CGT is minimal or absent (if the price has not changed).
The amateur won 2 BTC, waited a year, the price increased 3 times - the tax is charged on the difference.
The pro gets 5 ETH monthly from the game - taxed as business income.
7. Recommendations to players
Fix the cryptocurrency rate at the time of winning.
Store statements from casinos and cryptocurrency wallets.
Use Australian licensed crypto exchanges for withdrawals.
During regular operations, consult with an accountant familiar with crypto taxation.
Conclusion
In Australia, the taxation of cryptocurrency winnings depends not so much on the fact of the game as on the subsequent actions with digital assets. For amateurs, the tax arises only when converting or selling, and for professionals - when the winnings are received.
Current on: 11 August 2025
Short conclusion
In Australia, cryptocurrency is treated as property rather than currency. Winnings received in digital assets are subject to taxation according to the rules depending on the status of the player (amateur or professional) and the nature of the operation.
1. Legal status of cryptocurrency in Australia
Regulated by the Australian Taxation Office (ATO).
Classified as Capital Gains Tax (CGT) asset.
Any cryptocurrency transaction (sale, exchange, conversion) can trigger a tax event.
2. Taxes for gambling enthusiasts
The very fact of winning cryptocurrency from playing in a casino or betting is not subject to income tax.
The tax arises when cryptocurrency is sold or exchanged for fiat or other cryptocurrency.
Capital Gains Tax is applied when the value increases from the moment of winning to the moment of sale.
3. Taxes for professional players
Cryptocurrency winnings are considered business income.
Profit is subject to income tax at rates for individuals or companies.
Ability to account for game-related expenses in tax deductions.
4. AUSTRAC Role and Operations Control
Large transactions are captured and verified.
Transfers to fiat through licensed exchanges are transferred to AUSTRAC.
If money laundering is suspected, transactions may be frozen until the circumstances are clarified.
5. Procedure for calculating tax when selling winnings in cryptocurrency
1. Determine the market value of the asset at the time of winning.
2. Determine the sale or exchange price.
3. Difference between the sale price and the value at the time of winning = CGT taxable base.
4. If the asset has been held for more than 12 months, a CGT discount of up to 50% (for individuals) may apply.
6. Examples
The amateur won 2 BTC and immediately exchanged for AUD - CGT is minimal or absent (if the price has not changed).
The amateur won 2 BTC, waited a year, the price increased 3 times - the tax is charged on the difference.
The pro gets 5 ETH monthly from the game - taxed as business income.
7. Recommendations to players
Fix the cryptocurrency rate at the time of winning.
Store statements from casinos and cryptocurrency wallets.
Use Australian licensed crypto exchanges for withdrawals.
During regular operations, consult with an accountant familiar with crypto taxation.
Conclusion
In Australia, the taxation of cryptocurrency winnings depends not so much on the fact of the game as on the subsequent actions with digital assets. For amateurs, the tax arises only when converting or selling, and for professionals - when the winnings are received.
