ATO warning re “wash sales” at tax time The ATO is warning taxpayers to not engage in ‘asset wash sales’ to artificially increase their losses and reduce gains or expected gains. Wash sales typically involve the disposal of assets such as crypto and shares just before the end of the financial year to generate a capital loss, and where after a short period of time the taxpayer reacquires the same or substantially similar assets. The ATO says a wash sale is a form of tax avoidance that the ATO is focussed on at tax time – and warns that it’s sophisticated data analytics can identify wash sales through access to data from share registries and crypto asset exchanges.
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