December 9, 2025
If you’ve been buying, selling, or trading cryptocurrency, there’s something you should know: IRD is watching more closely than ever. What once felt like a grey area is now firmly in IRD’s spotlight — and they’re taking action.
Here’s a simple breakdown of what’s happening, why, and how you can stay out of trouble.
Crypto is treated as property in New Zealand. That means most crypto transactions are taxable, including:
Selling crypto for NZD
Swapping one token for another
Using crypto to buy goods or services
If you made a gain at any point, IRD expects it to be declared in your tax return. Unlike shares or property, IRD assumes most people buy crypto to make a profit, so gains are usually taxable by default.
IRD has shifted from “wait and see” to active enforcement, and it now has the tools to track crypto activity with surprising accuracy.
IRD has collected data on hundreds of thousands of NZ crypto users from:
Local and international exchanges
Blockchain analytics
Overseas tax authorities
And from 2026, a new global reporting system means crypto data will be automatically shared across borders.
Since late 2023, IRD has been sending letters to people it suspects may have undeclared crypto income. Another wave went out in 2024, and more are expected.
Ignore these letters, and you could be facing a full audit.
If IRD finds undeclared crypto income, expect:
Back taxes (at rates up to 39%).
Penalties of 20–40% for mistakes.
Penalties up to 150% for evasion.
Interest charges.
One NZ trader learned this the hard way after turning $100k into $1.6m, not declaring the gains, then watching his portfolio fall back to $100k — leaving him with a $600,000 tax bill – yikes!
If you’re dealing with crypto — even casually — here’s how to protect yourself:
If you made money through selling, trading, or swapping crypto, include it in your tax return. Don’t assume it’s tax-free.
Track dates, NZD values, and what you bought and sold. Good records make calculating tax (and responding to IRD) far easier.
Crypto gains are taxed like any other income. Set aside a portion of profits so you’re not caught out if the market drops.
If you’ve underreported crypto income in the past, approaching IRD before they find you can dramatically reduce penalties.
Crypto tax can be complex. If you are in doubt, give us a call better to get it right now than deal with IRD later.
As the year wraps up, it’s a good time to review your crypto activity, check your tax position, and make sure everything is above board. A little preparation now can save a lot of stress down the track.
