NFT Tax in Australia: What You Need to Know
If you’ve bought, sold, or created NFTs in Australia, the ATO (Australian Taxation Office) considers it a taxable event. Whether you’re flipping collectibles, creating digital art, or experimenting in Web3, you may owe Capital Gains Tax (CGT) — or even income tax.
This guide breaks down everything Australians need to know about NFT taxes in 2025: how it works, what’s taxable, what to report, and how to stay compliant.
⚠️ Disclaimer
This article is for general information purposes only and does not constitute financial, tax, or legal advice. NFT taxation can vary depending on your individual circumstances. Always consult a qualified tax professional or accountant familiar with Australian crypto regulations before making decisions or lodging your tax return.
Are NFTs Taxed in Australia?
✅ Yes. NFTs are treated as crypto assets under Australian tax law.
That means:
- Buying, selling, or trading NFTs is a taxable event
- The ATO treats NFTs like other crypto assets (e.g., Bitcoin, Ethereum)
- Taxes apply whether you’re an investor, collector, or creator
📚 Official ATO Crypto Guidance
What Taxes Apply to NFTs?
| Situation | Tax Type | Who It Applies To |
|---|---|---|
| Selling an NFT for a profit | Capital Gains Tax | Investors, collectors |
| Swapping one NFT for another | Capital Gains Tax | Traders |
| Creating (minting) and selling | Income Tax | NFT artists, creators |
| Getting paid in NFTs | Income Tax | Freelancers, employees, contractors |
| Airdrops and giveaways | Income Tax / CGT | Based on use and intent |
1. Capital Gains Tax (CGT) on NFTs
If you sell an NFT for more than you paid for it, the profit is a capital gain, and CGT applies.
Examples:
- Bought an NFT for $300 AUD, sold it for $1,000 AUD → $700 capital gain
- Swapped one NFT for another → treated as a disposal and a CGT event
✅ The 50% CGT discount may apply if you held the NFT for over 12 months.
2. Income Tax on NFT Earnings
If you’re creating, minting, or earning income through NFTs (e.g., selling your own digital art), the ATO considers that business income — and you may be taxed under income tax rules, not CGT.
Applies to:
- NFT artists and project creators
- Freelancers paid in NFTs
- Dropshipping NFTs or earning royalties
🧾 You’ll need to report income at the market value in AUD at the time of receipt.
3. NFT Royalties and Passive Income
If you earn royalties from NFT resales, that’s treated as ordinary income and must be reported in your tax return.
Keep track of:
- Date received
- AUD value at the time
- Platform used (e.g., OpenSea, Foundation)
4. NFT Airdrops and Free Mints
Free NFTs (airdrops, mint passes, giveaways) can still be taxable.
| Scenario | Tax Outcome |
|---|---|
| NFT airdropped to your wallet | Treated as income at the time of receipt |
| Later sell the airdropped NFT | CGT applies on the profit |
How to Report NFT Transactions to the ATO
You’ll need to declare all taxable events in your annual tax return.
Tools that help:
🧠 Tip: Keep a record of:
- Wallet addresses used
- Date/time of transactions
- Market value in AUD
- Transaction purpose (buy, sell, mint, royalty)
What If I Made a Loss on NFTs?
Losses can be used to offset capital gains on other crypto or assets, and even carried forward to future tax years.
But: NFT losses cannot be used to reduce regular income tax.
Do I Need to Register an ABN for NFT Income?
If you earn significant income from selling NFTs or operate like a business, you may need to:
- Register for an ABN
- Report on BAS
- Charge GST if applicable
If in doubt, speak to a registered accountant.
FAQs — NFT Tax in Australia
Q: Are NFTs considered crypto?
A: Yes. The ATO treats NFTs as a type of crypto asset for tax purposes.
Q: Is every NFT sale taxed?
A: Yes — if there’s a gain, CGT applies. If you’re a creator, income tax may apply instead.
Q: What if I’m just experimenting or testing?
A: If there's a sale, swap, or receipt of value — it may still be taxable.
Q: Do I need to pay GST on NFTs?
A: Possibly, if you’re registered for GST and running a business involving NFTs.
Final Tips for NFT Tax Season
- ✅ Log every transaction (even free mints and swaps)
- ✅ Use ATO-compliant crypto tax software
- ✅ Talk to an accountant familiar with NFTs & crypto
- ✅ Keep AUD values for every NFT-related event
