Question 1

How is cryptocurrency taxed in NZ 2027?

Accepted Answer

IRD treats most cryptocurrency as personal property acquired with the intention of disposal — making gains fully taxable as ordinary income at your marginal rate (10.5%, 17.5%, 30%, 33%, or 39%). NZ has no capital gains tax distinction for crypto. If you bought BTC intending to sell at a profit, the entire gain is income on sale. Losses are deductible against other crypto income.

Question 2

What is the difference between income and capital treatment for crypto?

Accepted Answer

If your intent at purchase was to dispose of the crypto for profit (most situations), gains are 100% taxable as ordinary income. The only way to avoid this is if you can demonstrate the crypto was held for a non-investment reason — extremely difficult for any speculative asset. Treating crypto purely as a long-term store of value rarely passes IRD's intent test. Assume all gains are taxable unless otherwise advised.

Question 3

Which cost basis method does IRD accept?

Accepted Answer

IRD accepts FIFO (First-In-First-Out), weighted average cost (WAC), and specific identification methods for crypto. You must use the same method consistently across the tax year and cannot switch between methods to game gains. FIFO tends to give higher taxable gains in a rising market (old cheap coins are sold first). WAC smooths the cost basis.

Question 4

Do I pay tax on crypto-to-crypto trades?

Accepted Answer

Yes — each crypto-to-crypto trade (e.g. BTC to ETH) is a taxable disposal in NZ. You must calculate the NZD value at the time of trade. The gain or loss is the NZD value received minus the cost basis of the crypto given up. This applies even though no NZD changes hands. Staking rewards and airdrops are also taxable as ordinary income at receipt.

Question 5

Are crypto losses deductible against my salary?

Accepted Answer

Crypto losses are generally deductible only against other crypto income — not against salary or wages. The exception is if you can demonstrate trader status with a regular pattern of trading; then losses may offset other business income. For most retail investors, crypto losses are ring-fenced to crypto. Carry-forward losses can offset future crypto gains.

Question 6

Do I report crypto on my IR3 tax return?

Accepted Answer

Yes — crypto income (gains, staking rewards, mining, airdrops) is reported in the 'Other Income' section of your IR3. Keep detailed records of all transactions including dates, NZD value at time of trade, cost basis, and the calculation method used. IRD has access to NZ exchange data via reporting requirements — under-reporting can trigger audits and penalties.

NZ Cryptocurrency Disposal Tax 2027 Calculator

How NZ taxes cryptocurrency in 2027

Cost basis methods — FIFO, WAC, or specific ID

Example: NZ$15,000 BTC gain on NZ$80,000 salary

How to use this NZ crypto tax calculator