Crypto has had a big month. First, there was the crypto crash which saw a huge decline in the value of several stable coins, becoming virtually worthless. Then, we had the announcement from the ATO that Cryptocurrency would be under the microscope come tax time.

Whist many people were shocked to see such a swift decline in the value of the stable coins, the ATO’s announcement came as less of a shock. Crypto has been at the top of the ATO’s list for the last few years, monitoring capital gains and losses.

Crypto owners who have seen a major loss in the value of their coins may have disposed of their investments for whatever price they could get. We see this in the traditional market too when there is a major decline.

The misconception here is that when the value is down, you have ‘lost’ money. This is untrue. If you continue to hold an asset, you have not lost any money until you physically sell.

If you are a Crypto investor who has seen a loss recently you may be wondering how this will impact your tax.

The best thing you can do is report your losses. When you report your losses from Crypto, you may be able to offset gains in other areas.

Remember, if you own crypto, it should be part of a diversified portfolio. A diversified portfolio will help to offset any losses like this by balancing out gains in other asset classes.

If you have experienced a capital loss from cryptocurrency, get in touch with your advisor.

Alternatively, you can get in touch with our financial planning division for advice on creating a more diversified portfolio.

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Armada Accountants Pty Ltd – ABN 79 009 298 542, Armada Financial Planning Pty Ltd – Corporate Authorised Representatives of Armada Wealth Management Pty Ltd AFSL 535978, Armada Lending Pty Ltd – ABN 20 603 067 983 – Authorised Corporate Credit Representative (470054) of BLSSA Pty Ltd (ACL 391237), Armada Audit Services Pty Ltd – ABN 39 151 015 002, Armada Business Services Pty Ltd ABN 29 008 762 481 are members of the Armada Group. Each member of the Armada Group is a separate legal entity in its own right and is not in partnership with any other members of the Armada Group. Liability limited by a scheme approved under Professional Standards Legislation.


Armada Accountants & Advisors acknowledges and pays respect to the past, present and future Traditional Owners and Elders of this nation and the continuation of cultural and spiritual practices of Aboriginal and Torres Strait Islander peoples. Armada also acknowledges the Traditional Owners of the land where our Perth and Port Hedland offices are located, the Whadjuk Noongar People (Perth) and Kariyarra People (Port Hedland).

Copyright © 2022 Armada Accountants & Advisors.
ALL RIGHTS RESERVED 

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