New Zealand Crypto Tax 2025 – IR3, FIFO/WAC and IR3K Explained

New Zealand has no general capital gains tax, but that does not make crypto profits automatically tax-free. For the 2025 IR3 income year, the result depends on why the cryptoasset was acquired, what activity produced it and whether a derivative is a financial arrangement. This guide follows Inland Revenue guidance and shows how to prepare a defensible NZD reconciliation.

Is crypto taxable in New Zealand?

Yes, in many cases. Inland Revenue treats cryptoassets as property for tax purposes. New Zealand does not have a standalone, comprehensive capital gains tax, but ordinary income tax provisions can still tax an amount derived from disposing of a cryptoasset.

The most important question for many private holders is the main or dominant purpose at the time of acquisition. If a cryptoasset was acquired for the purpose of selling or exchanging it, the resulting profit is generally taxable. A person may also be taxable because they are carrying on a cryptoasset trading business or undertaking a profit-making scheme.

A long holding period does not create an automatic exemption. Conversely, describing every crypto sale as taxable without examining the facts is too broad. IRD says that a taxpayer who claims there was no disposal purpose needs clear and compelling evidence, assessed from the circumstances existing when the asset was acquired.

The 2025 IR3 period and filing route

This guide concerns the 2025 IR3, covering 1 April 2024 through 31 March 2025. The standard filing deadline was 7 July 2025 unless an extension applied, for example through a tax agent.

The official IR3 guide for 2025 places profit from the sale of property that is not otherwise returned in Question 28, Other income, with supporting details. A cryptoasset trading business follows the business-income route instead and may need business accounts and an IR3B schedule. Box and question numbers can change between return years, so a 2025 schedule should not be copied mechanically into a later IR3.

A crypto tax report is a supporting calculation and reconciliation. It is not an Inland Revenue form and does not replace the taxpayer's classification decision or the figures entered in myIR.

Which crypto transactions are disposals?

According to IRD, a disposal can include:

• selling Bitcoin or another cryptoasset for NZD or foreign currency;
• exchanging one cryptoasset for another, including a token-to-stablecoin swap;
• using crypto to pay for goods or services; and
• giving cryptoassets to another person.

Moving assets between wallets, addresses or exchange accounts that all belong to the same taxpayer is not a disposal. Correctly identifying self-transfers is therefore essential: treating both sides as a sale and a new purchase would create artificial income and break the cost history.

FIFO or weighted average cost: both are accepted

IRD's calculation guidance expressly allows two cost allocation methods:

• FIFO (first in, first out): the oldest available units are treated as disposed of first.
• Weighted average cost (WAC): the cost of available units is pooled into a weighted average.

FIFO is therefore not an official default imposed by New Zealand tax law. The selected method should be documented and applied consistently across the taxpayer's complete holdings, including all wallets and domestic or overseas platforms. Switching methods merely to select a lower result for an individual disposal would undermine the reconciliation.

Simple NZD calculation example

A taxpayer buys 1 BTC for NZD 60,000 and pays a NZD 100 acquisition fee. They later sell it for NZD 90,000 and pay a NZD 150 sale fee:

• Net proceeds: NZD 89,850
• Cost: NZD 60,100
• Calculated profit: NZD 29,750

The same principle applies to a crypto-to-crypto exchange. The outgoing asset is tested as a disposal at its NZD market value, while that value generally starts the cost record for the asset received. Fees must be assigned consistently and not deducted twice.

What is not taxed yet?

IRD's calculation page states that unrealised gains and losses are not taxable or deductible. A market price increase while an asset remains held does not by itself create taxable income. Tax consequences generally arise from a disposal, from receiving taxable income, or from a separate regime such as the financial-arrangements rules.

Staking, mining and lending rewards

Rewards must be classified from the underlying activity. Mining or staking carried on as a business or as part of a profit-making scheme can produce taxable income when rewards are received and may also produce a taxable profit on later disposal. Rewards paid for services or received through an income-earning activity can likewise be income.

It is not sufficiently accurate to label every staking credit as automatically taxable without considering the facts. New products may involve staking-as-a-service, lending, liquidity provision or a change in legal ownership. Each arrangement should be reviewed according to its contractual and economic substance.

Where the NZD value of a reward has already been included in taxable income, that recognised value generally needs to be preserved as cost for the later disposal calculation. Otherwise the same economic amount could be taxed twice.

Airdrops and hard forks are not automatically income on receipt

IRD says an airdrop may be taxable on receipt, on disposal, or both. Receipt can be taxable where the recipient has a cryptoasset business, participates in a profit-making undertaking or scheme, provided services for the airdrop, or receives airdrops regularly in circumstances that make them income.

In other cases the receipt is not taxable. A later disposal still requires a separate test. Passively received tokens may not have been acquired for the purpose of disposal, while tokens received for services or as part of a profit-making scheme can produce a taxable result. The report should therefore show an unconfirmed airdrop separately until the taxpayer selects the appropriate treatment.

DeFi, wrapping, bridges and liquidity pools

DeFi is not one uniform tax category. IRD instructs taxpayers to consider the legal effect of each smart contract. If depositing an asset means the taxpayer loses ownership and receives a different token or contractual right, a disposal may have occurred. A transfer that merely moves the same beneficially owned asset may have a different result.

For that reason, token symbols alone cannot determine the answer. Wrapped tokens, liquidity-pool tokens, lending receipts and bridge transactions require protocol-level evidence, including the contract, wallet-transfers-steuer">wallet flow and rights retained by the user.

Crypto futures, options and IR3K

Spot cryptoassets are generally excepted financial arrangements. Derivatives require a separate analysis. Inland Revenue's published explanation of the 2022 amendments states that crypto futures are subject to the financial-arrangements rules in the same way as comparable share futures, while qualifying options to acquire or dispose of cryptoassets were added to the excepted-financial-arrangement rules.

For a financial arrangement, income and expenditure may need to be spread over its term rather than reported only when cash is received. When it is sold, transferred, matures or is remitted, a base price adjustment may be required. The 2025 IR3 guide provides a cash-basis concession only when its statutory thresholds are met.

IR3K is not a schedule for every spot crypto sale. It is the official calculation form for a financial arrangement sold or matured, generally used by a cash-basis person, and its result feeds into Other income on the IR3. Open derivatives and instruments outside the cash-basis rules may require a more detailed spreading calculation and professional review.

How should funding fees be reported?

There is no universal IRD box called “crypto funding fee”. The treatment depends on the associated derivative and whether the payment is part of financial-arrangement income or expenditure, a separately deductible cost, or already embedded in the exchange's realised P&L.

A defensible report therefore keeps funding payments in a separate worksheet until their treatment is confirmed. It should not silently add them to derivative P&L, because exchanges differ in what their exports include. Reconcile the funding ledger to the exchange statement first, determine the tax nexus and then transfer the confirmed amount once. This avoids both omission and double counting.

Business trader or private holder?

IRD considers transaction frequency, time and effort, organisation, continuity, reasons for trading, holding periods and the amount invested when deciding whether someone operates a cryptoasset trading business. A high-volume, systematic activity is more likely to be a business, and business holdings may be trading stock.

Not being a business trader does not make gains automatically tax-free. A private holder can still be taxable under the acquisition-purpose or profit-making-scheme provisions. Conversely, a taxpayer who keeps particular assets outside a trading business needs strong evidence showing that separation at both acquisition and disposal.

Record-keeping checklist for an IRD-ready reconciliation

IRD requires cryptoasset records to be retained for at least seven years. A complete file should include:

• the asset type, transaction date, event type and number of units;
• the NZD value and the source of the exchange rate or market price;
• acquisition cost, proceeds and transaction fees;
• beginning and end-of-year holdings, reconciled as at 31 March;
• exchange CSV files, bank records and wallet addresses;
• evidence supporting self-transfers and beneficial ownership;
• the selected FIFO or WAC method and any classification decisions; and
• separate schedules for rewards, airdrops, DeFi, derivatives and funding fees.

Download exchange histories regularly. Platforms can close, restrict old exports or change their file format, while blockchain data by itself often does not contain the NZD valuation or the reason for a transaction.

How CoinTaxReporting supports the New Zealand return

The CoinTaxReporting New Zealand module prepares a filing-support report rather than pretending to replace the official IR3. Users can select FIFO or WAC, choose the tax character of mining, staking, lending and airdrop activity, and keep uncertain derivative or funding items visible for review.

The report separates confirmed amounts from technical worksheets, reconciles transactions in NZD and identifies the relevant 2025 filing route. This is especially important where a dataset combines spot trading, rewards, DeFi and financial arrangements.

Official Inland Revenue sources

• IRD: Cryptoassets overview
• IRD: Buying and selling cryptoassets
• IRD: Calculating cryptoasset income
• IRD: Record keeping for cryptoassets
• IRD: Airdrops
• IRD: IR3 forms and guides

Frequently asked questions

Disclaimer: This article is for general informational purposes only and does not constitute tax advice. For individual tax advice, consult a licensed tax professional.