Portugal Tax Authorities Clarify That Buying Or Selling Cryptocurrency Is Tax-Free

The U.S. might be taking a hard line on cryptocurrency, but not all nations are looking to collect from the virtual currency boom. The PTA (Portuguese Tax & Customs Authority) has announced that in Portugal buying and selling cryptocurrency is tax-free. 

The statement came at the same time that the IRS (Internal Revenue Service) has announced a crackdown on cryptocurrency. On the other hand, Portugal has taken the opposite tack; it made clear that buying as well as selling cryptocurrencies would not be subject to VAT (value-added tax) or capital gain taxes. Previously, the PTA clarified in the year 2016 that in Portugal buying or selling cryptocurrency would not be measured as a taxable event which means that it’s not subject to tax.  There are some exceptions: taxpayers who deal in cryptocurrency as a business or professional activity are still subject to some taxes and the receipt of cryptocurrency in trading for services or goods doesn’t amend the tax treatment of the original transaction. 

A value-added tax or VAT is a little bit same as sales tax, but not exactly the same thing. A sales tax is a tax usually tacked onto the end of a sale of services and goods, much like local and state taxes are forced. The VAT is a consumption tax but, different from a sales tax, along the production chain it’s collected at every stage. 

As per the news in a local paper, Portugal will treat cryptocurrency as a type of currency, making it free from capital gains and VAT. That’s reliable with its plan on other currency: Portugal does not tax the gain on the sale or value of any currency. With the statement, Portugal has made it clear that it is, at least for now, is a tax-friendly place for those who buy and sell cryptocurrency. On the other hand, remember that citizens of the US are taxed on their global income, meaning that a journey across the pond won’t be sufficient to cut your tax bill.


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Lindsay Benjamin

Between blockchains and the unregulated sector, cryptocurrency has come a long way already. For it to be integrated into the normal economy, there is still a lot of ground to cover. Lindsay understands this and conveys the fluctuations in the cryptocurrency markets and new developments.
mm

Lindsay Benjamin

Between blockchains and the unregulated sector, cryptocurrency has come a long way already. For it to be integrated into the normal economy, there is still a lot of ground to cover. Lindsay understands this and conveys the fluctuations in the cryptocurrency markets and new developments.

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