The Portuguese Tax Administration (PTA) has officially announced that individuals do not need to pay value added tax (VAT) when buying or selling bitcoins and other cryptocurrencies. 🥇
Portuguese tax authorities published such an explanation in response to a request from a company that plans to engage in mining.
All types of cryptocurrency transactions, including payment for goods and services, converting cryptocurrency into fiat money, and opposite, buying cryptocurrency for fiat, as well as trading in digital assets, are exempted from this fee. 🔥 📝
In addition, individuals holding Bitcoins and Altcoins are exempt from income tax. At the same time, companies will have to pay capital gains tax, which ranges from 28% to 35% of the income received.
In its clarification, the Portuguese Tax Administration refers to the decision of the European Court of October 22, 2015 the case C-264/14, concerning the major Swedish bitcoin portal Bitcoin.se and its moderator David Headquist.
The court ruled that Bitcoin is a means of payment and therefore the exchange must be exempted from Value Added Tax obligations. However, the Swedish Tax Agency subsequently objected to the decision, arguing that the court did not fully understand the issue. 📝
It should be noted that today there is no single approach in the world to the taxation of cryptocurrencies transactions.
While the Value Added Tax exemption is applied in most countries, in many of them fiscal authorities consider it appropriate to charge residents with this tax if the virtual money held by the holders at the end of the reporting period (usually a year) has increased in value.
For example, in Germany, capital gains tax is not levied on the sale of bitcoins, but if investments are held for less than one year, then income tax is applied. Moreover, the income tax in Germany is progressive and can be up to 45%. 🔍
In Switzerland, which is considered a cryptocurrency friendly country, residents must pay income tax, income tax and property tax for their crypto assets.
Therefore, a similar step by the Portuguese tax authorities can be considered very liberal with respect to the participants in the cryptographic space of the country. 🤔
That is a huge step in the Bitcoin and other Cryptocurrancy Acception and Integration
Hype is coming. Hold on!