5 Ways to Avoid Crypto Tax in New Zealand

In this guide, we’ll break down the basics of how cryptocurrency is taxed in New Zealand and share five simple tips that can help you save thousands of dollars today. 

How can I avoid crypto taxes in New Zealand? 

It’s important to remember there is no way to legally evade taxes on cryptocurrency. In the past, the IRD has requested information from New Zealand exchanges to crack down on tax fraud. 

Starting in 2026, the IRD will have even more information at its disposal. The Crypto-Asset Reporting Framework (CARF) — adopted by more than 50 countries worldwide — will allow the IRD to access offshore transaction data. 

Remember, the penalties for tax evasion are serious. If the IRD chooses to prosecute, the maximum penalty is a fine of $50,000 and imprisonment of up to 5 years. 

We strongly recommend against tax evasion in any and all circumstances. Instead, you should consider using the strategies below to legally reduce your tax liability. 

5 simple ways to avoid crypto taxes in New Zealand 

Hold your cryptocurrency 

The simplest way to avoid cryptocurrency taxes is to hold your crypto for the long-term. Remember, there are no taxes for holding cryptocurrency or transferring crypto between wallets that you own. You won’t be taxed unless you choose to sell or otherwise dispose of your cryptocurrency.

Realize profits in low income years 

New Zealand has a progressive tax system. That means the higher your total income, the higher taxes you’ll pay. 

As a result, many investors choose to realize profits on cryptocurrency in years where their income is low. For example, selling cryptocurrency in a year when you are in between jobs can potentially save you thousands of dollars. 

Harvest your losses 

Disposing of your cryptocurrency at a loss comes with tax benefits. Losses from cryptocurrency can reduce your taxable income. 

When you lose money on a cryptocurrency trade, you can offset your income for the year — whether it’s income from your cryptocurrency investments or income from your job!

Deduct relevant expenses 

Deducting relevant expenses can help you reduce your taxable income. 

The type of expenses you can claim vary depending on whether you are in the business of trading cryptocurrency. The IRD does give several examples of expenses that are generally deductible on its website. These include: 

• The cost of your crypto-assets (including relevant transaction fees) 
• Depreciation of relevant capital assets (such as computers and hardware)
• Other expenses related to crypto-asset activity (such as electricity for cryptocurrency miners) 

Use crypto tax software 

Filing your taxes incorrectly can cost you thousands of dollars. Remember, the penalty for tax evasion is 150% of your shortfall!  

If you’re having trouble reporting your taxes, crypto tax software like CoinLedger can help. The platform can automatically import transactions from exchanges like CoinSpot and blockchains like Ethereum and help you generate a comprehensive tax report in minutes. 

Get started with a free CoinLedger account today. 

How is cryptocurrency taxed in New Zealand? 

In New Zealand, cryptocurrency is subject to income tax when it is earned or disposed of. 

Earning cryptocurrency: When you earn cryptocurrency, you’ll recognize income based on the fair market value of your crypto at the time of receipt. Examples of this include earning referral, mining, and staking rewards. 

‍Disposing of cryptocurrency: When you dispose of cryptocurrency, you’ll recognize income based on how the price of your crypto has changed since you originally received it. Examples of disposals include selling your crypto, trading it for another crypto, and gifting your crypto.

For more information, check out our guide to how cryptocurrency is taxed in New Zealand.