Lodge after 14 July
While lodging your tax return straight away can be tempting, you’re actually better off waiting a few weeks, here’s why:
- Payroll pre-fill: Employers in Australia have until 14th July to finalise their payroll reporting to the Australian Tax Office (ATO), including finalising payroll that detail your income and the taxes which were withheld through the year.
- Complicated: Lodging your tax return before payroll reporting can lead to discrepancies and the potential need for amendments, which will unnecessarily complicate your tax return.
- ATO audit risk: Lodging before 14 July increases your risk of an ATO audit, as they know early lodgers have a higher chance of making mistakes. This is due to the non-finalised payroll data and other pre-filled tax information from your bank and investment brokers.
Tip: Wait until after 14 July before lodging your tax return to make preparing your tax return simpler and to reduce the chance of an ATO audit.
Use the time before 14 July to double-check your tax records and consult with a tax professional if necessary. This preparation allows you to ensure that all information is correct and complete, ensuring a stress-free tax return.
Review and record your crypto transaction records
For your crypto investments, the first thing you should do is download your Transaction Records and Balance Statements from each platform and wallet that you used.
If you use a crypto tax calculator like Syla, it can make the process much easier. Syla is an official tax partner for the majority of Australian exchanges and have convenient integrations for importing your transaction records from hundreds of global exchanges, wallets and blockchains.
This ensures you meet your ATO record keeping requirements, and also makes it much easier to calculate your tax outcomes. As an added bonus, keeping your records in Syla means you can easily check your tax position through the year.
Common mistakes to avoid when lodging your crypto tax
Crypto tax can be complex, and common pitfalls include:
- Forgetting to report all transactions: It's essential to account every trade, sale, crypto-to-crypto swap, and airdrop.
- Misclassifying transactions: Staking rewards and airdrops are often taxed differently than capital gains.
- Failing to keep detailed records: Maintain comprehensive records of all transactions including dates, amounts, and the currency type.
How to reconcile and lodge your crypto tax
Here’s how you can do your crypto tax in 2024:
1. Collect and import your transaction records: Collect all your transaction records and account statements from your exchanges and wallets.
Tip: We recommend downloading a Balance Statement (also called an Account Statement or Holding Statement) from each platform. The Balance Statement should show your balance of each crypto asset at the end of the day on 30 June.
Doing this makes it easier to confirm that the calculated balances in your tax software match the reported balance on the exchange. It’s an important piece of your record keeping which sometimes gets forgotten. If your exchange or wallet doesn’t provide a Balance Statement, then you can take a screenshot of your current balances and save the filename with the current date.
2. Import your transactions: Using Syla as your crypto tax software, you can sync your transactions from your exchanges and wallets using an API sync or by importing a CSV transaction file. Now you’ll have a complete record of all your transactions across each exchange, wallet and blockchain that you’ve used.
Tip: If you have more than 20 or so trades, then we recommend using a dedicated crypto tax software. Not only will this help ensure the tax outcomes are accurate, but it will save you a lot of time trying to do the CGT calculations manually.
3. Reconcile your balances: Check that the calculated balances in your tax software match the reported balances from your Balance Statement. If your balances don’t match, then you may have some missing transactions which you still need to import.
4. Edit and classify transactions: Depending on the complexity of your activity you may have some transactions which need to be manually classified or edited to ensure the tax outcomes are correct. If your situation is complex, you can consider engaging a tax professional to assist you.
5. Download your tax report: Once you’re happy with everything, you can download your Crypto Tax Report, which contains a summary of all your tax outcomes. You can provide this report to your tax agent, or you can use it to self-lodge your crypto tax.
Timing your tax return
While you shouldn't lodge before 14th July, you certainly should get everything in order as early as you can.
The best thing you can do, is get an estimate on your tax position as soon as possible. This way you'll know whether you have tax you need to pay, or whether the ATO owes you a refund.
If the ATO owes you a refund, then you'll probably want to lodge as early as possible after 14th July. However, if you have to pay tax to the ATO, you may be better off delaying a little bit longer. 😅
For your 2024 tax return, you’ll need to make sure you lodge by the deadline:
- Individuals: Lodge by 31 October 2024.
- Individuals working with a tax agent: Lodge by 15 May 2025.
Delaying lodgment might be beneficial if you expect to owe tax, as it extends the payment deadline. However, ensure all documentation is prepared well before the final deadline to avoid stress.
FAQs
How are crypto staking rewards taxed?
Usually as ordinary income at the time they are received.
What if I don't report my crypto transactions?
This can lead to penalties and potential audits from the ATO.
Can I deduct losses on my crypto transactions?
Yes, but specific rules apply, so consult a tax professional for your situation.
About Syla
At Syla, we specialise in Australian crypto tax, and our software supports over 500 global exchanges, wallets, and blockchains. We are the official tax partner for all major Australian crypto exchanges, helping you to manage your tax obligations efficiently.
Make tax time easier, register for a free account to get started.
