Quick answer
Not every sale matches to the oldest purchase — the UK's disposal matching hierarchy determines which acquisition is matched to which disposal.
Accounting
Australia
United Kingdom
Disposal Matching Rules
Rules determining which acquisition is matched against a disposal for capital gains purposes, particularly HMRC's same-day and 30-day priority rules.
AustraliaUnited KingdomUnderstanding Disposal Matching Rules on crypto
Disposal matching rules determine which acquisition is used to calculate the cost basis for a given disposal, particularly where multiple acquisitions of the same asset exist. In the UK, HMRC has a strict three-tier hierarchy: (1) same-day acquisitions are matched first, (2) acquisitions within the following 30 days are matched next (bed-and-breakfasting rule), and (3) the Section 104 pool average is used for any remaining unmatched disposals. These rules take precedence over individual lot selection or chronological matching. Australia uses a simpler approach — the ATO generally accepts FIFO or another consistent method for matching identical assets.
Disposal matching rules determine which acquisition is used to calculate the cost basis for a given disposal, particularly where multiple acquisitions of the same asset exist. In the UK, HMRC has a strict three-tier hierarchy: (1) same-day acquisitions are matched first, (2) acquisitions within the following 30 days are matched next (bed-and-breakfasting rule), and (3) the Section 104 pool average is used for any remaining unmatched disposals. These rules take precedence over individual lot selection or chronological matching. Australia uses a simpler approach — the ATO generally accepts FIFO or another consistent method for matching identical assets.
What this means for your crypto activity
UK mandatory hierarchy
In the UK, you cannot freely choose which acquisition to match against a disposal — the three-tier hierarchy is mandatory.
Same-day matching
Same-day purchases and sales of the same crypto are matched against each other first — eliminating any gain or loss differential.
30-day bed-and-breakfast rule
Repurchasing the same crypto within 30 days neutralises a loss claim — the 30-day bed-and-breakfasting rule.
Section 104 pool
All other disposals use the Section 104 pool average — lot-level selection is not permitted.
Australia flexibility
Australia allows more flexibility but consistency in the chosen method is expected.
- In the UK, you cannot freely choose which acquisition to match against a disposal — the three-tier hierarchy is mandatory.
- Same-day purchases and sales of the same crypto are matched against each other first — eliminating any gain or loss differential.
- Repurchasing the same crypto within 30 days neutralises a loss claim — the 30-day bed-and-breakfasting rule.
- All other disposals use the Section 104 pool average — lot-level selection is not permitted.
- Australia allows more flexibility but consistency in the chosen method is expected.
Seeing it in action
Example scenario
On 1 March, Emily sells 2 ETH and also buys 1 ETH on the same day. HMRC matching rules: the 1 ETH bought on 1 March is matched against 1 ETH of her sale first (same-day rule). The remaining 1 ETH disposal is matched against the pool. The same-day match eliminates any gain on that matched ETH (since purchase and sale prices are the same day), while the pool average determines the gain on the other ETH.
How this works across jurisdictions
- Australia
ATO accepts FIFO or other consistent method for matching disposals to acquisitions in identical asset pools; no equivalent mandatory matching hierarchy.
- United Kingdom
Mandatory three-tier matching: (1) same-day rule, (2) 30-day rule (bed-and-breakfasting), (3) Section 104 pool. No individual lot selection permitted.
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