You have had a effective year on the markets, daily you wake up and check the latest news feed to see what prospects the day might bring. You see the markets diligently, patiently waiting for the right signal before placing your trades. You cash out just before the day ends so you can rest easy at night, checking your profits from the trading day.

If this scenario sounds even somewhat familiar then there is a very good chance that you are a digital asset trader rather than an investor. Traders are different from Investors as they are in the online business of earning income from their trading activities. A good hint that you might be a trader is if your action is performed under a business entity, however a person can still be thought to be a trader if you fit the right profile.

Identifying yourself as a trader has significant tax implications, and it is very important that you are knowledgeable of of these implications while you carry out your trading activities.

Telltale Indicators

  • The purpose of your activities is profit making.
  • You place a fairly large amount of trades, reaching anywhere from the hundreds to the hundreds of thousands.
  • Your activity is high volume and regular.
  • A large part of your time period is spent conducting research, placing trades and supervising outcomes.
  • You use a systematic approach. Everything is well research and planned in detail, you keep comprehensive records and receipts of your trades.
  • You have a large amount of investment capital invested in your venture.

Being regarded as a trader carries with it many of the same benefits that a business receives. A more diverse set of rules and techniques are available and can often permit for a better tax outcome. In some scenarios, specifically in the 2018 financial year we have identified that traders consistently achieved better tax outcomes than investors.


  • Many of the advantages of being a business can be applied, even if you are an individual.
  • Expenses connected to your trading activity are deductable.
  • Much increased degree of flexibility in how your taxable income is calculated.
  • Business related tax offsets may apply.

A specialist tax accountant gives the best opportunity for both exploring and successfully applying these rules to your specific case. Intricate knowledge of the asset class required is critical in correctly applying these principles in a manner compliant with ATO regulations.

Australian Accountants are specialists in the cryptocurrency taxation and accounting space. When you work with us, you are doing work with an accounting firm that actually understands crypto and understands how to talk your language. We are sensitive about taxation and work diligently to fully understand each of our clients on an individual basis. Our goal is always to make sure that the best outcome for you and bring certainty to your trading activity. If you are looking through this article then you undoubtedly could be benefiting from a taxation specialist. Our first consultation is no cost and no obligation, we want to hear your story.