• About Us
  • Advertise with Us
  • Contact Us
  • Events
  • Newsletter
  • Podcasts
  • Digital Magazine
  • Home
  • News
  • Opinion
  • Entrepreneurship
  • Self Development
  • Growth
  • Finance
  • Marketing
  • Technology
  • Sustainability
  • About Us
  • Advertise with Us
  • Contact Us
  • Events
  • Newsletter
  • Podcasts
  • Digital Magazine
NZBusiness Magazine

Type and hit Enter to search

Linkedin Facebook Instagram Youtube
  • Home
  • News
  • Opinion
  • Entrepreneurship
  • Self Development
  • Growth
  • Finance
  • Marketing
  • Technology
  • Sustainability
NZBusiness Magazine
  • News
  • Opinion
  • Entrepreneurship
  • Self Development
  • Growth
  • Finance
  • Marketing
  • Technology
  • Sustainability
EOFY 2023/24Opinion

Crypto taxes: ignorance is never bliss

Janine Grainger
Janine Grainger
March 21, 2024 3 Mins Read
3.7K Views
0 Comments
Crypto taxes

With the financial year set to close out at the end of this month, here’s a beginner’s guide to getting crypto taxes right by Janine Grainger, Founder of Easy Crypto.

Crypto has become the darling of alternative investments, captivating the financial world with heart-stopping falls (hello 2021 and 2022) and meteoric rises (hello 2024 and the potential effects of halving). But amidst the adrenaline-fueled rollercoaster ride that is crypto trading, many enthusiasts forget about taxation – mistakenly assuming crypto falls outside of the realms of more ‘traditional’ financial regulations.

Whether you’re ‘hodl’ing (holding on for dear life) or engaging in frequent trading, remember that the taxman is keeping a watchful eye on your crypto earnings.

The bottom line

Alas, even in crypto – the taxman still cometh and your assets are subject to taxation under country-specific income tax rules. In simple terms, any gains or losses from your crypto investments must be declared as part of your taxable income within each tax year. Just like any other activity that you do to make a profit (such as your 9-5, running a business, trading stocks or setting up a lemonade stand), you need to pay income tax on the profits you make.

Income tax will normally apply to any ‘disposal’ of crypto – this includes selling for NZD/USD or trading it for another crypto. Income tax also applies to your income on crypto holdings, e.g. staking or yield.

Although this might ‘sound’ simple, it can be complex to manage when adjusting your portfolio, for example you may want to temporarily move your Bitcoin into stablecoin to wait out some market volatility and then get back in. Although you have not ‘sold out’ of crypto, the tax ticket is clipped with any gains and the question becomes (especially for high income earners) whether it is worth ‘trading’ dips when this may create a 31-39% taxable event.

There’s no simple way to say this

Rules and regulations around crypto gains vary significantly from one region to another and it’s crucial to familiarise yourself with the relevant legislation in your specific regions to ensure you’re complying.

In general, however, there are some common principles that apply wherever you’re trading:

  • If you’ve made gains from your crypto ventures, you’re obligated to pay taxes on those profits.
  • On the flip side, if you’ve incurred losses, you may be able to offset them against taxes paid in other areas, such as PAYE on your salary.

It’s not all bad news

But while the taxman may demand his due on crypto gains, there are certain situations in which you can breathe a sigh of relief…

You don’t normally need to pay income tax on any cryptocurrency you are holding and haven’t sold or swapped yet. This includes purchasing crypto with fiat currency. In addition, with crypto such as stablecoins in the underlying currency, there is no price change/volatility associated with a purchase/sale and no associated taxable event is triggered.

Similarly, if you’re simply hodling onto your crypto assets without engaging in active trading, you may not be liable for taxes until you decide to sell or dispose of them.

Additionally, the transfer of Bitcoin between wallets, as well as gifting or donating crypto, typically does not trigger tax obligations.

When it comes to taxes, ignorance is never bliss

With the crypto market booming and profits tantalisingly within reach, it’s essential to remember your obligations to the taxman. Failing to report your earnings could land you in hot water with authorities. By familiarising yourself with the relevant tax laws in your jurisdiction, staying abreast of regulatory developments, and seeking professional advice when necessary, you can ensure that your trading remains both profitable and above board*.

*I always recommend getting professional tax advice.

Share Article

Janine Grainger
Follow Me Written By

Janine Grainger

Janine is a kiwi-born entrepreneur and a highly respected Leader in tech. She's the co-founder and CEO of Easy Crypto, New Zealand's leading cryptocurrency trading platform.

Other Articles

Tax advice from Lisa Martin
Previous

A time for accountability

Reefton Distilling Co. Gareth Morgan & Patsy Bass
Next

Scotch whisky expert secures key West Coast role

Next
Reefton Distilling Co. Gareth Morgan & Patsy Bass
March 26, 2024

Scotch whisky expert secures key West Coast role

Previous
March 20, 2024

A time for accountability

Tax advice from Lisa Martin

Subscribe to our newsletter

NZBusiness Digital Issue – March 2025

READ MORE

The Latest

From redundancy to resilience

May 16, 2025

Episode 16: Bryce Marsden on sustainable impact through education, youth and environment

May 15, 2025

The high cost of leadership neglect

May 14, 2025

Why making Auckland a Tech Hub makes sense

May 14, 2025

Is AI making us happier? Why some Kiwi leaders would trade coffee for Generative AI

May 13, 2025

Step back to move forward – how Kiwi business owners can unlock growth

May 12, 2025

Most Popular

NZBusiness Digital Issue – June 2024
Understanding AI
Navigating economic headwinds: Insights for SME owners
Nourishing success: Sam Bridgewater on his entrepreneurship journey with The Pure Food Co
How much AI data is generated every 60 seconds? New report reveals global AI use

Related Posts

The high cost of leadership neglect

May 14, 2025

Is AI making us happier? Why some Kiwi leaders would trade coffee for Generative AI

May 13, 2025

Step back to move forward – how Kiwi business owners can unlock growth

May 12, 2025

The state of our environment as a call to adventure

May 5, 2025
NZBusiness Magazine

New Zealand’s leading source for business news, training guides and opinion from small businesses to multi-national corporations.

© Pure 360 Limited.
All Rights Reserved.

Quick Links

  • Advertise with us
  • Magazine issues
  • About us
  • Contact us
  • Privacy policy
  • Sitemap

Categories

  • News
  • Entrepreneurship
  • Growth
  • Finance
  • Education & Development
  • Marketing
  • Technology
  • Sustainability

Follow Us

LinkedIn
Facebook
Instagram
YouTube
  • Home
  • News
  • Opinion
  • Entrepreneurship
  • Self Development
  • Growth
  • Finance
  • Marketing
  • Technology
  • Sustainability