Tax Filing

Capital Gains Tax

Tax on profit from the sale or disposal of a capital asset, including cryptocurrency in most jurisdictions.

Australia

Canada

Germany

India

United Kingdom

United States

Quick answer

The tax you owe on profit when you sell, swap, or dispose of a crypto asset for more than you paid.

Understanding Capital Gains Tax on crypto

Capital gains tax (CGT) applies when you dispose of an asset — including cryptocurrency — at a profit. The gain is the difference between what you received and your original cost basis. Most jurisdictions treat crypto as a capital asset, meaning every sale, swap, or spend is a potential CGT event. Short-term and long-term rates often differ, with longer-held assets taxed more favourably.

What this means for your crypto activity

Every disposal counts

Every crypto sale, swap, or spend triggers a CGT calculation — not just withdrawals to fiat.

Holding period matters

Your holding period determines whether short-term or long-term rates apply.

Losses can offset gains

Losses from other disposals can offset your gains and reduce your overall tax bill.

Cost basis method affects gain

Cost basis method (FIFO, HIFO, etc.) directly affects how large your gain appears.

Gifts and donations

Gifting or donating crypto may also trigger CGT in many jurisdictions.

Every crypto sale, swap, or spend triggers a CGT calculation — not just withdrawals to fiat.
Your holding period determines whether short-term or long-term rates apply.
Losses from other disposals can offset your gains and reduce your overall tax bill.
Cost basis method (FIFO, HIFO, etc.) directly affects how large your gain appears.
Gifting or donating crypto may also trigger CGT in many jurisdictions.

Seeing it in action

Example scenario

Priya buys 1 BTC for £20,000 in January 2023 and sells it for £35,000 in March 2024. Her capital gain is £15,000. After applying the £3,000 annual CGT allowance (UK 2024–25), £12,000 is taxable. As a higher-rate taxpayer, she pays 24% CGT — a tax bill of £2,880.

How this works across jurisdictions

Australia
50% CGT discount for assets held 12+ months; full gain included for short-term holdings.
Canada
50% capital gains inclusion rate; gains included in income at marginal rate.
Germany
Tax-free if held over 1 year; short-term gains taxed as income at up to 45%.
India
Flat 30% tax on VDA gains under Section 115BBH with no deduction except cost of acquisition.
United Kingdom
18% (basic rate) or 24% (higher rate); £3,000 annual exempt amount for 2024–25.
United States
Property treatment; short-term gains taxed as ordinary income, long-term at 0–20% depending on bracket.