The 2027 CGT reset and crypto

A wallet balance can contain purchases made on different dates at different Australian-dollar prices. The enacted 2027 capital gains tax (CGT) reform treats an eligible investment holding parcel by parcel. For an individual assumed Australian resident throughout ownership and never a temporary resident, a parcel held across 1 July 2027 can have a deferred pre-reset gain and a separate post-reset gain. The 2027 CGT reform calculator models one parcel at a time; a tax return brings all relevant gains and losses together.

This article concerns crypto held as an investment under the capital gains rules. The ATO distinguishes investment, personal use and business activity. Mining, trading as a business, rewards and periods of foreign or temporary residence can change the treatment. A quoted wallet value alone is not a realised gain.

What happens to crypto held across 30 June 2027?

The statutory reset is a deemed transaction

The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 was enacted on 26 June 2026; the reset it inserts into Income Tax Assessment Act 1997 sections 112-155 and 112-160 operates at 1 July 2027. For an eligible parcel, the individual is deemed to sell it just before 1 July and reacquire it just after. The default new cost base uses market value just before 1 July 2027. The notional gain or loss is disregarded at that point and deferred until an actual CGT event. No trade is required to create the statutory reset.

The reset applies to an eligible asset, not to a wallet's total balance. It does not give every holder a fresh 50% discount on the whole later gain. The Act's transition provisions preserve the old discount rules for an eligible deferred pre-reset gain, tested against the actual disposal date. The post-reset portion generally uses the enacted indexation method instead. A separate 30% minimum-tax top-up may apply to the relevant post-reset gain if ordinary tax attributable to it falls short of the Act's floor. It is not a flat charge on the entire wallet or on the pre-reset portion. The automatic reset explainer covers the eligibility exceptions.

What value must be recorded at the reset?

The Act's default is market value at the statutory moment; it does not prescribe one exchange or price feed. Evidence for a parcel therefore needs its token and quantity, the time of the quotation, the market price and the Australian-dollar conversion. A thinly traded token may be difficult to value. Original acquisition records remain necessary because the pre-reset portion is only deferred, not erased.

Section 112-155 allows another apportioning method only where one is determined under section 112-185 and chosen. Treasury's consultation on an apportioning method is an exposure draft, not an operative formula. Both examples below use the enacted market-value default. A later instrument would need checking against the actual disposal.

Which crypto transactions are disposals?

The ATO's transaction guidance treats selling crypto for dollars, swapping one token for another, spending it and gifting it as disposals. The Australian-dollar value of what is received or given up matters even where no cash reaches a bank account. A swap of token A for token B can therefore both end an A parcel and establish the acquisition details of a B parcel. Keeping the same beneficial ownership while moving assets between your own wallets is different; the transfer alone generally does not dispose of the asset, although a network fee paid in crypto may itself be a disposal. The ATO's crypto tax tips PDF, last updated 4 October 2022 distinguishes those events.

For a gift, the ATO's crypto guidance calls for market-value evidence rather than assuming nil proceeds. Actual fees, other CGT events and capital losses affect a return.

Worked example: two different assets in one wallet

Holder A: two purchases at different dates

Assume one resident individual has $90,000 of other taxable income in 2027–28, no other gains or capital losses and two investment parcels of different crypto assets. Parcel A was acquired in February 2023 and parcel B in May 2027. Both are held over the reset and sold on 30 June 2028. The person is assumed Australian resident throughout ownership and never a temporary resident. The values are assumed Australian-dollar parcel totals, not observed market prices or forecasts.

For illustration the engine receives hypothetical CPI index numbers of 100 for reset expenditure and 105 at disposal, a 5% increase. Future published CPI is unknown. The calculation excludes fees and Medicare levy.

The deferred and later gain columns are before the discount and indexation respectively. Parcel B's old discount holding test uses its actual June 2028 disposal date, so its May 2027 purchase qualifies under these facts. Its later portion has a separate indexation test, also counting from the original purchase under the Act.

Together the parcels produce $36,000 taxable capital gain. Computing income tax on the full taxable income with and without that gain produces $10,800 income tax attributable to it and $0 minimum-tax top-up under the modelled settings. The holder's tax difference is calculated on the combined gain.

Worked example: three purchases of the same token

Holder B: several prices and lower other income

Assume a different resident individual has $45,000 of other taxable income, no other CGT events or losses and three investment parcels of the same token. Parcel C was acquired in March 2021, D in September 2024 and E in May 2027. All are held through the reset and sold on 30 June 2028. The same hypothetical CPI indices of 100 and 105 apply. The person is assumed Australian resident throughout ownership and never a temporary resident. Parcel E's original cost is below the personal-use threshold, but its investment purpose means the exemption does not apply.

The three independently calculated parcels contribute $27,850 of taxable capital gain. Income tax on the combined taxable income, less income tax on the holder's other income, is $8,680 income tax attributable to those gains; the modelled result is $0 minimum-tax top-up. Adding tax calculated on each parcel in isolation would produce a different answer here because the low income tax offset phases out across the combined income. The parcels' acquisition dates, values and indexation assumptions are illustrative. They do not describe a sale plan or expected crypto performance.

What crypto records are needed for a 2027 reset?

The ATO requires records for each crypto asset and transaction, including acquisition and disposal dates, Australian-dollar values, the other party or address, purpose, exchange history, wallets and relevant costs. A reset calculation also needs evidence of the statutory market value for each eligible parcel. A wallet's current balance cannot reconstruct its cost history.

The ATO says to keep these records for five years from the later of when they are obtained, when the transactions or acts are complete or the year of the CGT event. Its record-keeping page also explains how exported exchange histories, blockchain explorers and wallet evidence can help reconstruct missing information. Records should support both the pre-reset and later legs of a realised parcel.

What information does the ATO receive?

The ATO obtains purchase and sale information from Australian crypto designated service providers and matches it against tax reporting. Its published crypto data-matching protocol covers 2014–15 to 2025–26; that document alone does not establish a protocol for 2026–27. Provider data does not replace a holder's records of cost bases, private-wallet movements, purpose or reset valuation.

Do personal use, theft and rewards change the answer?

The personal-use exception is narrow

ATO guidance asks whether the crypto was kept or used mainly for personal use or enjoyment at disposal. Investment crypto does not become a personal-use asset merely because it is later spent on a personal item. Under section 118-10(3) of the Income Tax Assessment Act 1997, a gain from a qualifying personal-use asset is disregarded only where the first element of its cost base is $10,000 or less; a loss from a personal-use asset is disregarded. Both worked holders kept their parcels as investments, so neither uses that exception.

Lost or stolen crypto needs evidence

The ATO says a lost private key or stolen crypto may support a capital loss, subject to evidence. It lists when the key was acquired and lost, the wallet address, acquisition cost, the value of the crypto assets in the digital wallet when the private key was lost and proof that the holder controlled the wallet. Losing access temporarily is not the same as proving the asset is irretrievable. A hypothetical loss is not included in either worked example.

Staking rewards have a separate income step

The ATO's staking guidance treats the Australian-dollar value of additional tokens received as ordinary assessable income when received. That value becomes their cost base; a later disposal can then have a separate CGT result. The examples cover purchased investment parcels only. The ATO also addresses airdrops, but their initial-allocation facts can differ, so no airdrop amount is modelled here.

Does a sale followed by a repurchase change the reset?

An actual sale and repurchase is different from the Act's deemed transaction. ATO Taxpayer Alert TA 2008/7 and Taxation Ruling TR 2008/1 address arrangements that generate a tax loss or deduction while substantially retaining exposure to the asset. The ATO says Part IVA can apply depending on the facts and purpose. That loss-focused guidance does not establish that every repurchase is a wash sale, or that a gain-realising arrangement is automatically outside all anti-avoidance rules. Nothing here suggests selling, buying back or choosing a date.

For an ordinary disposal without the reform transition, use the capital gains calculator. The shares and ETFs reform article explains the same parcel-by-parcel transition for listed investments.