Cryptocurrencies are designed around the idea of no central bodies being in a total, centralized control and many of us would prefer that no amount of our crypto profits goes to the taxman. However, having clear taxation rules might be beneficial for the industry, legitimizing digital coins as a viable alternative to traditional money, essentially making taxes a necessary cost of doing business.
The reality is that the rules are often ambiguous and how Bitcoin and Co. are treated greatly differs from one country to another. With the tax season being in full force, we have decided to dig in deep and delve into the crypto tax state across thirteen European countries. The Bitvalex crypto tax guide will shed light on the share of profits their residents need to forego to their governments. Some countries have decided to treat trading cryptocurrencies and holding them for the long run differently, some don't, and some, surprisingly, are true tax havens for the crypto winners!
Countries That Treat Trading and Investmenthttps://bitvalex.com/article/the-best-european-crypto-tax-guidehttps://bitvalex.com/article/the-best-european-crypto-tax-guide the Same
Let's start with Estonia. It is considered one of the most open-minded countries with forward-looking cryptocurrency legislation. Currently, cryptocurrencies, such as Bitcoin, are regarded as property and your profits from selling them (the amount you received from the sale minus the amount you paid to obtain the cryptocurrencies) are subject to personal income tax at a 20% flat rate. Your losses, unfortunately, can't be declared and thus you bear 100% of the risk.
In Bulgaria, the government also doesn't differentiate between short- and long-term investment. If you realize a profit in a specific year from selling your Bitcoins, you are subject to a flat 10% capital gains tax, the same as if you were trading financial assets. The good news is that your losses will thus decrease your taxable gains.
Find out more about the taxes on crypto here: https://bitvalex.com/article/the-best-european-crypto-tax-guide
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