Taxation and Taxes to pay with cryptocurrencies in Spain
How are Bitcoin, Ethereum, Ripple, etc. taxed in Spain? What are the obligations of the tax regulations in Spain in this regard? .I have bought cryptocurrencies, do I have to pay taxes?
It depends on the tax:
For income tax purposes, the mere “possession” of cryptocurrencies does not imply that they must be expressly declared in the annual income tax return.
However, there is an obligation to declare the LOSSES or PROFITS that you have obtained with the purchase and sale of these cryptocurrencies.
Therefore, in conclusion, if you do not generate positive or negative returns, you do not have to declare anything for this purpose in the income tax return in Spain.
However, what are the taxes to be paid on the profits obtained from the sale of cryptocurrencies?
The conversion of cryptocurrencies into another commonly used currency, such as Euros, Dollars, etc., or into another cryptocurrency, is considered to be the “sale”. The best thing is that you request an annual list of the movements made during the year with the crypto, and that, either as a profit or loss, you declare it in the personal income tax return of the following year.
For example, the profits or losses that you have obtained with the sale (or conversion) of your cryptocurrencies of the year 2021, you will have to declare them together with the rest of the income that you have in the personal income tax declaration to be made before June 2022.
What is the total income tax to be paid in the event of the sale of cryptocurrencies?
The first thing to say is that profits or losses from the sale of cryptocurrencies are taxed as Savings Income in the IRPF, separate from work income (or pensions) as follows:
TAX RATE FOR SAVINGS
|Up to 6000 €||19 %|
|6000 – 49.999 €||21 %|
|50.000 – 199.999 €||23 %|
|+ 200.000 €||26 %|
IMPORTANT NOTE: In the case contemplated above, we are evaluating the taxes to be paid in case of “sale” of cryptocurrencies. In the event that your activity consists of the “Mining” of cryptocurrencies, this is a professional activity, for which you will have to register as a professional, self-employed, or legal entity, and the income obtained will be taxed by the corresponding part. to “economic activity” together with the expenses derived from said activity. You will only pay taxes on the net profit obtained from said activity.
INFORMATIVE declaration of assets – MODEL 720
Although there are still doubts as to whether it is mandatory to declare your cryptocurrencies for the purposes of form 720, our recommendation is that you proceed to declare them if you are a resident in Spain through this annual declaration form, especially if the value of your cryptocurrencies exceeds the 50,000 euros.
This tax is levied on the assets that you may have in your name. Therefore, it includes the holding of cryptocurrencies.• If you are not a Spanish resident: Then, this tax is levied on the assets you may have in Spain• If you are a Spanish resident: then this tax is levied on ALL assets you may have in Spain and in any other country in the worldTherefore, in the event that you are a resident in Spain, said tax includes the possession of cryptocurrencies, and its declaration through this tax is mandatory.
It must be said that the Wealth Tax is a regional tax that is ceded to the Autonomous Communities in Spain. In many of them, and depending on your place of residence, you will find that there are personal minimums for which, in the event that the total value of your assets does not reach said minimum, you should not pay this tax.
For example, in the Valencian Community this tax is only declared when, being a resident in this community, your assets in Spain exceed 600.000 EUR.