Crypto Lending & Borrowing Tax in Australia

Lending crypto — interest income

When you lend crypto and receive interest or reward tokens, the ATO generally treats the rewards as ordinary income at their AUD market value when received. That value also becomes your cost base.

Wrapped and receipt tokens

Depositing into a lending pool often gives you a receipt token (for example, a wrapped version of your asset). Exchanging your original token for the receipt token can be a CGT event because you have disposed of one asset and acquired another. Exchanging back is another CGT event.

Borrowing against crypto

Borrowing stablecoins or cash against your crypto is generally not a CGT event because you still own the collateral. However, if the platform liquidates your collateral to repay the loan, that is a disposal and triggers CGT.

Keep every transaction

Lending platforms generate many small transactions. Use DeFi-capable tax software such as Crypto Tax Calculator or Koinly to import on-chain data and categorise each event correctly.

General information only, current as a guide to ATO rules — not personal tax advice. Crypto tax depends on your circumstances. Verify with the ATO or a registered tax agent before you lodge.