Background

Emerging from the shadows, Satoshi revealed herself not just as the elusive founder of Bitcoin, but as a savvy Australian taxpayer ready to tackle the complexities of crypto taxation head-on.

Satoshi, now a seasoned crypto trader, has been operating as a sole trader and is classified as a high-income earner with an annual income exceeding $190,000. This places her in the top marginal tax bracket, subject to a tax rate of up to 45% + 2% Medicare Levy (as of 2025 FY). With her trading activities generating substantial returns, Satoshi is keen on finding a tax-efficient structure to maximise her net gains.

The Challenge

As a sole trader, Satoshi’s profits from trading Bitcoin, Ethereum, and other altcoins (do I hear gasps from the Bitcoin community?) which add to her other income, significantly increasing her tax liability. The volatility of the crypto market means that in bullish years, her tax bill can be exorbitant.

Strategic Restructure: Utilising Section 328-G

To mitigate these challenges, Satoshi consulted with a tax professional who recommended utilising the Section 328-G small business restructure rollover. This provision allows small business owners to transfer active assets between entities without immediate tax consequences, provided certain conditions are met.

Implementation

Satoshi decided to incorporate a company to handle her trading activities. By transferring her crypto assets and trading infrastructure to the newly formed company, she could benefit from the corporate tax rate of 25%* — significantly lower than her personal tax rate.

1. Professional engagement: Satoshi spoke to the best Brisbane crypto accountants (Consensus Layer 😉) to seek professional advice. This ensured Satoshi satisfied the conditional requirements needed to apply this rollover.
2. Formal Advice: After the crypto accountants researched and delivered a letter of advice, she then proceeded to implement the plan with their help.
3. Tax Rollover: Under Section 328-G, the transfer qualified for a tax-deferred rollover, meaning no immediate capital gains tax was payable on the transfer of assets.
4. Company creation: they created a new trading company so that she could transfer her crypto assets and start trading from.
5. Transfer contract: They engaged a lawyer who generated a sales agreement to formally acknowledge the sales transaction.
6. Asset Transfer: Satoshi transferred all her crypto assets, including her Bitcoin and Ethereum wallets, to new wallet addresses and new company crypto exchange accounts.
7. Accounting & record keeping: Brisbane’s best crypto accountants helped simplify Satoshi’s accounting by using crypto tax & accounting software to track her crypto activities.
8. Tax returns: When it came time to do her annual taxes, the accountants prepared the appropriate financials and tax returns to report the crypto transfers and small business restructure rollover.

* Based on the company passing the 80% Base Rate Entity Passive Income rules.

Results

By trading within a company, it allowed her to operate at a flat rate tax of 25%, allowing her to reinvest more of her funds to generate company profits. Satoshi’s personal liability was minimised, allowing her to focus on enhancing her trading strategies within the company framework.

Conclusion

This case study underscores how crypto traders can utilise specific tax provisions to their advantage. The 328-G small business restructure rollover is particularly effective for high-income individuals looking to optimise their tax obligations and reduce personal liability. As always, such transitions should be undertaken with appropriate professional advice to ensure compliance and optimal structuring.

If you're a crypto trader or a high-income individual considering a business structure shift, schedule a complimentary 30-minute discovery call to see how we can help. Our expertise in crypto taxation can help you navigate complex tax landscapes with ease, ensuring you stay ahead in the fast-paced world of cryptocurrency.