When you dispose of cryptocurrency to pay for a fee, you may trigger a capital gain tax (CGT) event on the disposal value of the fee itself. As a result, this capital gain/loss is realized on the difference between the acquisition and disposal price of the cryptocurrency before "paying" for the fee.
As an example:
You purchase 1 BNB to use for fees at the price of $10.
Sometime later, you then make a trade where you sell 100 DOGE and buy 1 ETH.
The fees for this transaction are paid for in BNB, and you pay a fee of 0.5 BNB. At the time of the sale, the price of BNB is now $15.
As a result, you've made a gain on the BNB itself of $2.50 (i.e. gain on the fee) since the acquisition value of the 0.5 BNB is $5.00 and the disposal value of the 0.5 BNB is $7.50 ($7.50 - $5.00 = $2.50). This will trigger a CGT event of $2.50 for the sale of the BNB.
But is the fee taken into account into the cost base?
Yes - typically the fee will be taken into account in the cost base of one of the assets in the trade.
Following on from the previous example:
The value of the 'fee' itself will be added to the cost base of the sale of the 100 DOGE.
If for example, you acquired the 100 DOGE for a total value of $100, and when you sold it the total value was $500, then the cost base of the DOGE would be $100 + $7.50 fee (from the BNB) = $107.50.
This will result in a CGT event of $500 - $107.50 = $392.50 at the time of the disposal of the DOGE.
But the fee should be deducted as it's paid. I didn't gain anything from it.
From the guidance we received from most of the tax offices, the fee is treated as the disposal of the assets. So if you dispose of it, it causes capital gain/loss, although you don't actually have any gain/loss in your account from the transactions.
Note: We do provide the Miscellaneous Expense Report that lists your fees and other expenses. You can file the deduction depending on your situation after consulting with your tax professional. As mentioned above, the fee is already added to the cost basis in CryptoTaxCalculator for individual users, if you want to do this, you might need to check your eligibility (e.g. as a business).
Read more: Fee is Missing