Welcome to my CryptoTrader.Tax Review Australia Edition. Today I’ll cover CryptoTrader.Tax, a DIY crypto software application that lets users calculate their crypto capital gains taxes in under 30 minutes. I’ll cover what crypto tax requirements are required by Australian citizens, how CryptoTrader.Tax works, its cost and its pros and cons.
Any form of cryptocurrency transaction is deemed a taxable event by the ATO. Cryptocurrency transactions include buying, selling, trading, mining, staking, earning, airdrops, giving and receiving among others. Therefore, if you’ve participated in any of these events as an Australian citizen, it is likely that you have reportable taxable events. For this reason, it is important to stay on top of your cryptocurrency transactions for tax-reporting purposes.
In Australia, whenever a profit is made from cryptocurrency, it is taxed based on the AUD value of the asset when it is exchanged for fiat currency (AUD), another cryptocurrency or when used for goods and services. For example, if you purchase 1 Bitcoin for AUD 10,000 and sell it for AUD 20,000 a month later, you are subject to capital gains tax on the profit made. In this case, it’s AUD 10,000. You will then pay capital gain tax at a rate determined by your tax bracket.
However, numerous variables such as whether you held the asset for one year or longer, exchange rates, fees and market spreads can play a decisive role in determining how much you owe. As this can be complicated, particularly for beginner investors or investors with hundreds/thousands of transactions, crypto software calculators such as CryptoTrader.Tax can be used to simplify your tax reporting obligations.
For more information on how cryptocurrencies are taxed within Australia, I recommend the following guide:
CryptoTrader.Tax is a financial services company that specialises in tax reporting and investment management. It is the signature platform of Coin ledger Inc, a company founded in Kansas City, Missouri in 2017. The platform features a tax reporting software specifically designed for the cryptocurrency market and for calculating capital gains taxes.
Founded during 2017, where Initial Coin Offerings (ICOs) were rampant and the cryptocurrency space consisted primarily of unproven technologies, the company’s mission was to simplify crypto tax reporting for everyone. Since then, the platform has developed over time to ensure that crypto tax reporting remains as simple as possible.
CryptoTrader.Tax generates crypto-based tax returns in four simple steps. These steps include importing your trades, adding additional crypto income, generating your tax report and filing your tax report. Due to the entire process being digitalised, this can be easily done in under an hour, making it one of the most effective software tools available.
The first step requires you to sync your trading history data from different exchanges and crypto platforms. It is currently compatible with 45+ crypto platforms, including Binance, BlockFi, Celsius and Gemini among others. Additionally, it supports 2,000 + cryptocurrencies, meaning that it will cover most investor’s needs.
When you sign up, you’re given the option of syncing with these platforms, making this process quick and automated.
As a bonus, you can retroactively calculate your returns from as far back as 2009. This can be useful for catching up on previously unfiled tax returns, as well as for determining whether you have any previous capital losses which can offset current or future capital gains.
This step refers to any additional forms of crypto income that isn’t the product of trading. These forms of income can include mining, gifts and airdrops. If none of these applies to you, you can skip this step.
Once you have entered all the relevant data, you will be asked to review your transaction history. If you’re happy that you’ve entered everything and that it’s correct, you can click a link that generates your report.
The final stage lets you file your crypto taxes with your generated report. This can be integrated with other online tax software such as TurboTax or TaxAct. Alternatively, you can choose to have your report sent to your accountant for them to file it on your behalf.
There are four different pricing options for CryptoTrader.Tax. These vary depending on the number of trades that you have executed.
All options come with a free trial and a 14-day money-back guarantee, meaning that if you’re unhappy with the service offered by CryptoTrader.Tax, after the initial trial, then you can get your money back.
One thing that separates CryptoTrader.Tax from its competitors is their free blog feature. This blog covers a range of different topics, such as the best exchanges, wallets, portfolio trackers and mining software. It also provides concise explanations on a range of different cryptocurrencies and products, such as defi, NFTs and popular altcoins. Lastly, they provide useful advice on crypto taxes and how cryptocurrencies are taxed in different countries.
This free information is great for beginners and people who are looking to improve their knowledge of these subjects. It also helps optimise the platform, as this information can make it easier to calculate your crypto taxes and understand the overall process.
Taxes are notoriously difficult, even more so when you introduce new monetary assets such as cryptocurrencies. As such, perhaps the most important feature of any crypto tax software is its ease of use. Fortunately for CryptoTrader.Tax, it’s an extremely simple platform to use.
With the platform being digitalised, most of the steps are fully automated. You simply need to link your exchanges/wallets with the platform and it will do the rest. Additionally, with only four steps (potentially 3 depending on your circumstances), the relatively esoteric task of calculating your cryptocurrency taxes can be done in under an hour.
Another thing that I like about this platform is that it’s compatible with other tax software, such as TurboTax and TaxAct. As such, you can use it alongside these platforms to generate a complete tax return. This distinguishes it from competitors which only allow you to generate crypto tax returns, as they require you to compile multiple reports independently, which can be both time consuming and confusing.
Alternatively, there is an option that allows you to forward your report to an accountant. So regardless of whether you want to file your taxes online or through an accountant, CryptoTrader.Tax has you covered.
Despite offering competitive pricing, it may be cheaper in some instances to simply calculate your returns yourself. This is particularly true for HODLers and people who don’t make frequent transactions, as these are easy to keep track of. Alternatively, if you know a good cryptocurrency accountant, they may be able to generate your full tax return for a competitive rate.
However, if you have numerous trades or have failed to keep a record of your transactions, the price may be worth it.
|Blog – Good Resource for Free Info||Pricing|
|Easy to Use – Beginner Friendly|
|Compatible with Other Software|
CryptoTrader.Tax is a great cryptocurrency tax calculator that simplifies crypto tax reporting requirements. With its simple four-step process and fully interoperable user interface, users can generate their cryptocurrency tax reports in under an hour. Additionally, their blog offers plenty of useful articles for people looking to learn more about the cryptocurrency space.
People who infrequently trade, keep a meticulous trading record or have access to a great crypto accountant may be better off submitting their returns or letting their accountant handle it. However, for people who make numerous crypto trades or perhaps don’t keep records of their transactions, this app can be a lifesaver.
If you’d like to sign up to CryptoTrader.Tax to try your free trial, you can do so by clicking this link
Once you’ve pressed the ‘Get Started For Free’ button and you have signed up, you can use this code to get 10% off any plan purchase – CRYPTOTAX10
If you’d like more information or a visual representation on how CryptoTrader.Tax works, I recommend the following YouTube Video:
Alternatively, these resources are also useful:
The following reviews cover my favourite crypto exchanges and interest earn platforms