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As world governments push through legislation to levy taxes on capital gains from bitcoin (BTC) transactions, seeking to earn more from an asset class that frowns on regulatory oversight, there are still a few countries that remain pro-crypto, allowing investors to buy, sell or hold digital assets at zero taxes.

Circumstances vary, but the real motivation leans more toward facilitating increased investment within the respective jurisdiction’s cryptocurrency industries, perhaps as a base for future taxation. For now, that has not happened yet. Here’s a list of eight countries – in no order of importance – which may be considered as bitcoin tax havens, states that don’t want your BTC investment gains.

In Portugal, tax authorities waived all tax on cryptocurrency trading and transacting – meaning that individuals do not have to pay capital gains tax or value added tax (VAT), when buying or selling BTC and other digital assets. The Portugal Tax Authority (PTA) said “an exchange of cryptocurrency for ‘real’ currency constitutes an on-demand, VAT-free exercise of services.”

While citizens are under no obligation to pay income tax when exchanging crypto for fiat, the PTA, however, indicated that businesses which accept digital currencies as payment for goods and services are liable to paying taxes such as VAT and income tax. The income tax relief makes Portugal’s laws some of the most favourable throughout the world, given how income tax is a huge expense on the accounts of most crypto traders.

If you hold bitcoin for one year or more in Germany, you won’t have to pay any taxes. Regardless of how much money you make selling your BTC, you do not pay capital gains as long as you have held your coins for a period exceeding 12 months.

Europe’s biggest economy regards BTC as private money, contrary to the widespread view in most developed countries, which look at crypto as currency, commodity or equity. In Germany, private sales that do not exceed 600 euros ($654) are tax-free. Businesses, however, are still obliged to pay taxes on gains emanating from bitcoin through corporate income taxes.

Both individuals and corporates who hold BTC or other digital assets as a long-term investment are not taxed in Singapore – simply because capital gains tax does not exist in the city-state itself.

However, enterprises based in Singapore are liable to income tax, should they be involved in cryptocurrency trading as a core business. Those that opt for bitcoin as payment for services rendered, or revenue, are subject to normal income tax rules. Companies are taxed on the profit generated within Singapore.

As with neighboring Singapore, there are no capital gains tax in Malaysia. Cryptocurrency trades involving cash or another digital asset are not taxed in the Southeast Asian country. However, this will likely change if BTC is recognized as legal tender in Malaysia, as has been rumoured in the local press in recent months.

In the Eastern European country of Belarus, a new law that came into effect in March 2018 legalized cryptocurrency, exempting individuals and businesses from any form of taxation for dealing in or with digital financial assets in whatever way, at least until 2023.

Individual activities such as mining or buying and selling of crypto, are considered personal investments, and therefore, are not subject to tax. Similarly, registered businesses operating in the special economic zone of High Technologies Park near the capital Minsk, involved in mining, trading, initial coin offerings or other crypto-related operations are not taxed.

For Slovenia, the tax system for individuals and companies involved with BTC is rather different. While no capital gains is levied on citizens for the sale of bitcoin and other cryptocurrencies, they are still expected to pay income tax regardless of the currency being exchanged. However, companies that receive payment in BTC or from crypto mining are required to pay tax at the corporate tax rate.

The taxation of corporations “depend on the circumstances of a particular case and the information provided in the declaration: income recipient status; type of income. If profits are recognized as capital gains, then the tax is 19%,” say experts.

The famed “blockchain island” of Malta does not tax long-held digital currencies, either for capital gains or VAT. However, crypto trades executed within the day are considered similar to day trading in stocks or foreign exchange, attracting tax as business income at the rate of 35%.

Malta is perhaps one of the most crypto-friendly countries in the world, initiating legislation that has legalized a variety of crypto operations in the country. The government recognizes bitcoin “as a unit of account, medium of exchange, or a store of value.”

In Switzerland, one of Europe’s crypto havens, qualified individuals that buy, sell or hold cryptocurrencies for personal benefit are not required to pay tax on their capital gains. However, income from mining, considered self-employment income, is taxed through income tax. Profitable crypto trading by qualified professionals is subject to corporate tax while wages paid in bitcoin must be declared for income tax purposes.

What do you think about bitcoin taxation around the world? Let us know in the comments section below.

The post Eight Countries That Don’t Tax Your Bitcoin Gains appeared first on Bitcoin News.

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