Key Takeaways
- An Australian judge ruled Bitcoin is money, not a CGT asset.
- The ruling could lead to $640 million in tax refunds if upheld on appeal.
- The ATO's crypto tax policy since 2014 is now being challenged in court.
A landmark ruling in an Australian court may overturn the country’s long-standing Bitcoin tax policy and lead to approximately $640 million in tax refunds.
Details of the ruling
On May 19, the Australian Financial Review reported that Judge Michael O’Connell of Victoria ruled Bitcoin should be treated as a form of money rather than as property.
The decision came in a criminal case involving federal police officer William Wheatley, who allegedly stole 81.6 BTC in 2019.
At the time, the bitcoin was valued at around $492,000; it’s now worth over $13 million.
Implications of the ruling
Judge O’Connell’s interpretation places Bitcoin in the same category as the Australian dollar, potentially exempting it from capital gains tax (CGT) laws.
Since 2014, the Australian Taxation Office (ATO) has classified Bitcoin as a CGT asset, meaning any disposal—including selling, exchanging, or using it for purchases—triggers a taxable event.
Expert opinions
tax lawyer Adrian Cartland said:
This totally upends the ATO’s position.
He noted that if Bitcoin is ruled as money…
… acquisitions and disposals of Bitcoin have no tax consequences.
Potential financial impact
Cartland estimates the ruling, if upheld on appeal, could lead to tax refunds totaling up to 1 billion Australian dollars (approximately $640 million).
The ATO, however, stated there are no confirmed figures on the amount that may be refunded.
Future implications
The case could have significant implications for how Bitcoin is treated under Australian tax law moving forward.
