Digital asset ownership is becoming increasingly common among young Australians. In fact, 32% of Gen Z Australians reported owning digital assets in 2024, up 11% points from the previous year, according to Swyftx’s 2024 survey. As more young people hold and earn crypto, families are increasingly asking how Australian tax rules apply to minors.
Importantly, Australia does not provide a minimum age exemption for crypto tax. So, a minor who makes a taxable crypto gain may still have a tax obligation. However, the amount of tax they may pay depends on two key tests, which we explain below.
Key Takeaways
- There is no age-based exemption from Australian crypto tax, regardless of how small the gain.
- The excepted person and excepted income tests decide whether adult or minor tax rates apply.
- Non-excepted minors face steep rates once the taxable income exceeds $416 in a single year.
- The standard $18,200 tax-free threshold only applies if one of the two tests is met.
- Reporting still requires completing question A1 on the individual tax return each year.
Who Counts as a Minor for Australian Tax Purposes?
Before applying any tax rate, you first need to establish whether the taxpayer is a minor. For Australian tax purposes, this is based on a specific age test rather than the date a crypto transaction takes place. That distinction matters because a person’s age is assessed at a particular point in the income year.
The Age Test at 30 June
For tax purposes, a minor is generally someone who is under 18 on 30 June of the relevant income year. This date is more important than the date of the crypto transaction itself. So, even if a minor sells crypto in March, their tax treatment is determined by whether they are under 18 on 30 June.
Why Do These Rules Exist?
These rules are designed to prevent adults from shifting income into a child’s name simply to access lower tax rates. This is particularly relevant to crypto because digital assets can be held by minors, and sizeable gains can arise from relatively few transactions.
- Investment gains could otherwise attract lower rates. Without these rules, parents could route investment gains through a minor and potentially reduce their overall tax.
- Crypto can be held in a child’s name. Wallets and exchange accounts can make it relatively simple to hold digital assets on behalf of a minor.
- Crypto gains can be significant. A large gain can make shifting profits to a child more attractive as a tax-saving strategy.
Do Minors Pay Tax on Crypto Gains Like Everyone Else?
It may seem reasonable to assume that a minor’s small crypto gain would fall outside the tax system. However, that is not how Australian tax rules work. Two key points explain why a minor can still have a tax obligation on crypto gains.
Crypto Is Still a CGT Asset, Regardless of Age
Crypto is classified as a Capital Gains Taxation (CGT) asset under Australian tax law. The Australian Taxation Office’s (ATO’s) guidance applies this classification regardless of the taxpayer’s age. As a result, when a 15-year-old disposes of crypto, the transaction can trigger a CGT event just as it would for an adult.
The Tax-Free Threshold Only Applies If Excepted
The standard $18,200 tax-free threshold does not automatically apply to minors. A minor can access it only if they qualify as an excepted person or if their income qualifies as excepted income. The excepted person test and the excepted income test decide almost everything from here.
Is Your Child an Excepted Person?
Being an excepted person is the strongest path to adult tax rates. It applies to every dollar a minor earns, crypto included, not just specific income types. There are three distinct ways to qualify, and only one needs to apply.
Full-Time Worker Test
A minor qualifies here if they worked full time in the income year. Working full time for three months or more also counts. They must also intend to keep working full time next year. Full-time study alongside that intention disqualifies them.
Person With a Disability
This applies to a minor entitled to a disability support pension, or whose carer receives a carer allowance for looking after them. Being certified permanently blind qualifies too, and so does having a disability with little financial support from relatives. The ATO’s under-18 exemption categories extend to two further situations:
- You’re unable to work full time because of a permanent disability, and you receive little or no financial support from your relatives.
- You’re the principal beneficiary of a special disability trust.
Person With a Double Orphan Pension
A minor entitled to a double orphan pension also qualifies here. This applies only where they receive little or no financial support from relatives. Both conditions need to be met together, not just one of them.
What Counts as Excepted Income for a Minor's Crypto Gains?
A minor does not need to be an excepted person for every dollar to get adult rates. Specific income categories qualify on their own, called excepted income. The four categories below matter most for crypto, and each one is explained in turn.
Income From the Minor's Own Business
Wages from an actual business count as excepted income outright, with no dispute involved. The complication begins once those wages get reinvested into crypto instead of spent. That reinvested amount does not automatically inherit the same excepted status.
Income earned as an active partner in a partnership also qualifies as excepted income. This covers the minor’s own share of partnership profits specifically. A separate crypto investment made alongside that partnership income does not share the same treatment.
Net capital gains from disposing of certain excepted-category property count as excepted income too. In practice, this applies narrowly, covering deceased-estate property, or business and partnership assets. Crypto bought with ordinary pocket money or wages falls outside this category.
Income from a deceased person’s estate, including a testamentary trust, is treated as excepted income as well. This covers both the original property and any reinvestment of it. An ATO worked example shows exactly how this gets calculated once reinvested into shares.
How Crypto Gains Get Taxed When They Are Not Excepted?
When neither test is met, the standard minor tax rates apply instead of adult ones. These rates were deliberately set higher than usual. The gap between the two systems is larger than most families expect.
The 2025–26 Rate Bands for Under-18s
These are the exact rate bands for the 2025 to 2026 year. They apply once a minor’s crypto gain fails both tests.
Income for the Year | Tax Rate |
$0 – $416 | Nil |
$417 – $1,307 | Nil plus 66% of the excess over $416 |
Over $1,307 | 45% of the total amount that is not excepted income |
Why Does a Small Crypto Gain Get Taxed Disproportionately Hard?
A crypto gain of a few thousand dollars can attract tax well above 30%, once averaged out. This happens because the 66% band bites early, right after the first $416. Most of a moderate gain gets pulled through that steep middle band, before the 45% rate applies.
An adult earning the identical gain would likely pay nothing at all. This is due to the standard $18,200 tax-free threshold applying instead. That gap exists deliberately. It removes any incentive for diverting income through a child’s name.
A minor named Charlie asked the ATO Community forum. Charlie explained that their family had become interested in crypto. Charlie asked what age crypto can legally be held. Charlie also asked who gets taxed if a parent holds a custodial account on a minor’s behalf.
Australian law sets no specific minimum age for holding crypto itself. That is a custody and account-access question, not a tax one. Most exchanges set their own minimum age through account terms, separate from anything the ATO regulates directly.
The tax question matters more here. If Charlie legally owns the crypto, Charlie declares any resulting gain, not the parent. A custodial account changes who manages the wallet day to day. It does not change who the crypto legally belongs to.
Whether that gain gets taxed at adult or minor rates depends on the two tests covered earlier. Without excepted person status, or excepted income, Charlie’s gain would face the steep 66% and 45% bands. Those bands were described in the section above.
Beyond the tax rate itself, families often get the ownership question wrong. Whose name a crypto gain gets declared under depends on who actually, legally, owns the asset. This is separate from who bought it originally.
If the crypto legally belongs to the minor outright, the minor declares any resulting gain. This applies to a genuine gift, for instance. It holds true even if a parent manages the wallet day to day.
A parent might instead hold crypto in trust, or custodially, for a minor. That arrangement can affect who declares the gain. Genuine trust structures may shift the outcome. Getting this wrong is a common, costly mistake.
Once ownership and the excepted tests are settled, reporting itself is mechanical. It runs through question A1 on the individual tax return. The steps below follow the ATO’s own instructions for that question.
Check whether any of the excepted person categories apply on 30 June. If yes, write $0 at label J, and print A in the Type box. The remaining steps below do not apply.
If none of the categories apply, add up all non-excepted income for the year. This includes net capital gains from crypto disposals. Those disposals must fail to qualify as excepted income under either test.
Subtract any deductions that relate directly to that income. This gives the taxable amount subject to higher minor rates. It replaces the standard adult rates and thresholds entirely.
Write the resulting amount at label J, and print M in the Type box. This figure is what gets taxed under the $416 and $1,307 rate bands described earlier.
Working out whether a minor’s crypto gain is excepted adds real complexity. Tracking it separately from an adult’s own holdings adds more. Families rarely keep two entirely separate records, one for a minor’s account and one for everything else.
KoinX brings that separation into one platform instead. Each holding, transaction, and gain stays clearly tagged and traceable. This matters most when only part of a portfolio ends up qualifying for excepted treatment.
KoinX automatically detects transfers between wallets and exchanges, and removes duplicates. This keeps a minor’s cost basis accurate. It avoids treating an internal transfer as a false disposal, which would overstate the actual gain.
Every transaction gets tagged instantly, whether it is a gift, a swap, staking, or an airdrop. That detail matters here directly. Correctly tagging a gift, for instance, helps confirm it does not qualify as excepted income.
Live valuations and profit tracking show exactly how a holding has grown over time. This makes it easier to see the size of a gain. That visibility matters well ahead of tax time, not just at the end.
This report applies ATO rules directly to a minor’s data. It covers CGT discounts, income, and portfolio balances in one place. It separates excepted gains from non-excepted ones clearly. The right rate band gets applied without manual sorting.
Get started with KoinX, and keep a minor’s crypto activity clearly separated and accurately tracked. It removes the guesswork from an already complicated area of Australian tax law.
Age offers no shortcut around Australian crypto tax. A minor’s tax rate depends on the excepted person and excepted income tests. It does not depend on the size of the gain. Most everyday gifts or pocket-money purchases fail both tests. This pushes the gain into the steep 66% and 45% bands. That is far higher than the adult threshold most families assume applies.
That gap between minor and adult rates makes early tracking essential. This matters for every family holding crypto in a child’s name. KoinX keeps a minor’s holdings separated and accurately tagged automatically. Join KoinX today, and keep records of every disposal ready before tax time.
Frequently Asked Questions
Does a Minor Get a Tax-Free Threshold on Crypto Gains?
No. There is no minimum age exemption from Australian crypto taxation rules. A minor is under 18 at 30 June of the income year. From there, the excepted person and excepted income tests decide their tax rate, not age alone. Failing both tests means the steep minor rates apply. This holds true regardless of how small the crypto gain actually is.
Does Crypto Bought With Pocket Money or Wages Count as Excepted Income?
Rarely, on its own. Employment income itself is excepted, and rarely disputed by the ATO. Reinvesting those wages into crypto does not automatically make the resulting gain excepted too. Pocket money saved and later invested follows the same pattern. Most everyday purchases fail this narrow test once the crypto is sold.
Is a Crypto Gift From a Grandparent Treated as Excepted Income?
Generally not, unless it came from a deceased estate, or from business or partnership assets specifically. A birthday gift bought with ordinary savings typically fails the excepted income test under current ATO guidance. The resulting gain, once sold later, gets taxed at the higher minor rates instead of adult ones.
Who Reports the Gain if a Parent Manages the Crypto Wallet?
Whoever legally owns the crypto declares the gain, regardless of who manages the account. If a minor genuinely owns it outright, the gain sits on their own return, using question A1. A custodial or trust arrangement can shift this outcome. The actual legal ownership structure needs checking carefully before lodging.
Who Reports the Gain if a Parent Manages the Crypto Wallet?
Whoever legally owns the crypto declares the gain, regardless of who manages the account. If a minor genuinely owns it outright, the gain sits on their own return, using question A1. A custodial or trust arrangement can shift this outcome. The actual legal ownership structure needs checking carefully before lodging.
