Income 2022: How to declare cryptocurrencies

The 2021 Income campaign has already started, and surely more than one taxpayer has doubts about how to declare their cryptocurrencies when rendering accounts with the Treasury.

The Treasury has included an exclusive section for cryptocurrencies in the 2021 Income campaign

Well, this year, the Treasury has included a new exclusive section in which the declaration of the cryptocurrencies is made, “Capital gains and losses derived from the transfer of other patrimonial elements”, which is located from box 1624 onwards. This will help to have greater control and knowledge of how many cryptos are circulating in our country.

In any case, the small investor still does not know how to declare his cryptocurrencies. That is why Coinmotion has created a decalogue to promote training and knowledge about the taxation of cryptocurrencies. These are its main conclusions, which will help the taxpayer who invests in cryptocurrencies:

Do I have to declare my cryptocurrencies?

Taxpayers with income from work of less than 22,000 euros per year, or less than 14,000 euros per year from more than one payer do not have to file the personal income tax return. However, those investors with returns lower than those indicated above if they obtained profits from cryptocurrencies, added to other returns, that exceeded 1,600 euros together in 2021, or losses of more than 500 euros, they would be obliged to make the declaration of this campaign. .

Should VAT be paid on the purchase or sale of cryptocurrencies?

No. The sale and purchase of cryptocurrencies is exempt from paying VAT because the AEAT considers bitcoin as an intangible asset that can be used as a means of payment and transactions with cryptocurrencies as transactions with intangible assets.

What happens if I have my cryptocurrencies in a virtual wallet and I do not carry out any operation?

The AEAT understands that virtual purses are considered current accounts, so as long as they are only deposited and no transactions are made with them, they are not taxed.

Model 720. And models 172, 173 and 721 on cryptocurrencies, what are they?

The Tax Agency has reported that information on cryptocurrencies should not be included in Form 720 of 2021, which refers to the informative declaration of assets abroad. The novelty is that the Treasury is preparing the new models 721, 172 and 173 for the declaration of cryptocurrencies.

We could say that the Model 721 is like a “homologue” to the current 720. In this new model, the owners themselves are also obliged to present it. This statement is merely informative.

On Model 172, individuals are obliged to declare the balances they have in cryptocurrencies and companies those of their clients, in addition to identifying their owners.

If I convert bitcoins into ethers or vice versa, do I have to pay taxes?

When an exchange of cryptocurrencies is made, we will have to pay taxes on the profit or loss generated, calculated by subtracting the higher of the 2 following values ​​from the acquisition value of the delivered good: the market value of the delivered good or that of the received good.

How are operations carried out with cryptocurrencies taxed in personal income tax?

At the moment in which we convert a cryptocurrency into FIAT currency or another cryptocurrency, an alteration of the value of our assets occurs that will generate a loss or a capital gain, which must be declared in personal income tax, incorporating it in the profit and loss section. assets of the savings tax base. This savings base is taxed as follows: 19% for the first 6,000 euros; 21% for the basic section between 6,000 and 50,000 euros; 23% for the section greater than 50,000 euros; and from 2021, 26% for the section that exceeds 200,000 euros.

How does the AEAT regulate the mining of cryptocurrencies?

The mining of cryptocurrencies is considered by the AEAT an economic activity. As a consequence of this regulation, the amounts received by the miner will be declared in Personal Income Tax, as income derived from the economic activity carried out, calculated based on the market price of the day they were received. The expenses derived from the exercise of their activity can also be deducted from this income. As long as it can be shown that they are necessary to obtain the income.

As for whether or not this consideration is subject to VAT tax, the AEAT establishes that since the cryptocurrencies are automatically generated by the network and a recipient of the mining activity cannot be identified, there is no direct relationship between the service provided and consideration received for what establishes that this activity is not subject to VAT.