Portugal has long attracted crypto investors, digital nomads, and entrepreneurs looking for a favorable tax environment in Europe. And it remains genuinely compelling — but the rules have changed significantly since 2023, and it’s important to understand exactly what you’re getting into before you pack your bags.
The short version: Portugal is still one of the best places in Europe to hold crypto long-term. If you hold for more than 365 days, your gains are tax-free. That’s a real and meaningful benefit. But the old Non-Habitual Resident (NHR) program that made Portugal a near-blanket tax haven is gone. Its replacement, IFICI, is a much narrower tool that most passive crypto investors won’t qualify for.
Here’s the full picture.
Since writing the original version of this article, I’ve personally received a ton of emails from people who have moved to Portugal or are in the process of moving, many of them with significant crypto holdings. That tells me there’s real appetite for this information — and also real risk of people acting on outdated advice about NHR that no longer applies to new arrivals.
See also: The Best Crypto Trading Apps
For those of you who have never visited Portugal, here’s some background.
Portugal is a member of the European Union and sits right on the Western edge of Europe, bordering Spain. Its climate is generally similar to Spain but it sits on the Atlantic coast, which means its seas are wavier and colder — a surfers’ paradise. The population sits at around 10 million, healthcare is ranked among the best worldwide, the local population is friendly and largely English-speaking, and crime levels are very low.
Portugal went through a genuinely tough economic period in the early 2000s, which led many younger people to leave and seek better conditions abroad. Tax incentive programs like the NHR were a deliberate countermeasure — an attempt to attract expats, returning Portuguese citizens, and international talent back to the country.
Portugal is one of the few countries that has been genuinely forward-looking about attracting high-net-worth individuals, investors, and entrepreneurs. But the specific tools it offers have changed. Let me walk you through what’s current.
See also: Lisbon vs Barcelona
What Happened to the NHR?
The original Non-Habitual Resident (NHR) program ran from 2009 to 2023. It was one of the most generous tax regimes in Europe — qualifying residents paid a flat 20% on high-value Portuguese-sourced income, and foreign income (including dividends from foreign companies) was broadly exempt from Portuguese tax. For crypto holders under NHR, this was extremely powerful.
The NHR closed to new applicants on 31 December 2023. Anyone who registered before that date continues to enjoy their benefits for the full 10-year period. But for anyone who hasn’t already registered, the old NHR is gone.
Portugal replaced it with a new program called IFICI.
IFICI (NHR 2.0): Much Narrower Than the Original
IFICI — Incentivo Fiscal à Investigação Científica e Inovação — came into effect on 1 January 2025. The headline numbers look similar to the old NHR: a flat 20% tax on qualifying Portuguese-sourced income, with foreign income exempt, for a 10-year period.
The critical difference is who qualifies.
Do you want to cut straight to the chase and know for sure if Portugal is the right place for you to move to? Schedule a consultation with my trusted Portuguese crypto lawyer to get all your questions answered.
Book a consultation with a Portuguese lawyer
Alternatively, are you still undecided about where to live or want to speak to me directly about crypto or other topics that I write about?
IFICI is specifically designed for people working in science, technology, and innovation. To qualify you generally need to:
- Not have been a Portuguese tax resident in the previous 5 years
- Hold a university degree (EQF Level 6+ Bachelor’s or PhD)
- Fall into one of these categories: university professors or scientific researchers; employees of companies with 50%+ export turnover in qualifying sectors (manufacturing, IT, R&D); employees or founders of certified startups; or certain highly qualified professionals in science, technology, healthcare, or green energy
- Spend 183+ days per year in Portugal or maintain a permanent home there
- Apply by 15 January of the year following establishment of residency
Passive investors — including crypto traders and holders who don’t work in a qualifying field — do not qualify for IFICI. The regime is explicitly designed for active contributors to innovation, not for financial structuring. Retirees are also excluded.
If you used the old NHR and are still within your 10-year window, none of this affects you. If you’re arriving in Portugal as a new resident from 2025 onwards, IFICI is the only game in town — and most crypto investors won’t qualify for it.
How Crypto Tax Works in Portugal
The crypto space is getting more complex over time with staking, lending, DeFi, NFTs, and tokenized assets — and each of those needs to be considered carefully. I’ll keep expanding this section based on my own research and discussions with Portuguese tax experts. Here’s the current state of play.
Crypto held more than 365 days: tax-free
This is the headline benefit that still makes Portugal genuinely attractive for long-term crypto investors. If you hold crypto assets for more than 365 days, any gains on sale are exempt from Portuguese tax. This applies regardless of whether you qualify for IFICI or any other special regime — it’s baked into the standard tax code.
This puts Portugal alongside Germany as one of the few EU countries that fully exempts long-term crypto gains. For a Bitcoin holder with a multi-year horizon, that’s a real and meaningful advantage.
Crypto held less than 365 days: taxed at 28%
Short-term gains — assets sold within 365 days of purchase — are taxed at a flat 28%. This has been the rule since 2023, when Portugal closed the pre-2023 loophole that made virtually all crypto trading tax-free.
Staking and lending income: taxed at 28%
Passive crypto income — staking rewards, lending yield, and similar — is generally taxed at 28% in Portugal. This is not covered by the 365-day exemption, which applies specifically to capital gains from sale. If you’re generating meaningful income from DeFi or staking, factor this in.
Reporting requirements since 2024
Since 2024, all crypto transactions must be reported in the annual Portuguese tax return (Modelo 3), even if the gains are fully exempt. If you hold crypto for more than a year and pay zero tax on the gains, you still need to declare the transaction. Good record-keeping and crypto tax software are essential.
Tokenized securities
Tokenized securities may not qualify for the 365-day exemption — the treatment is less clear-cut than for standard crypto assets. If you hold tokenized stocks, bonds, or similar instruments, get specific advice.
Non-cooperative jurisdictions
Tax exemptions may not apply to crypto assets linked to exchanges or structures in jurisdictions on Portugal’s blacklist. If you’re using platforms based in blacklisted territories, that’s worth checking.
Get in touch with a Portuguese crypto tax lawyer
The Honest Summary: Is Portugal Still Good for Crypto?
Yes — with an important caveat.
For long-term holders (1+ year), Portugal remains one of the best options in Europe. Zero tax on gains after 365 days is a genuine, substantive benefit. If you’re the type of investor who buys and holds, Portugal is still a strong choice.
For short-term traders and active DeFi participants, Portugal is no longer the obvious answer. A 28% flat rate on short-term gains and staking income is competitive with other European countries, but it’s not a standout advantage.
For most passive crypto investors hoping to use IFICI to avoid tax on other income, the regime won’t help. The old NHR era of moving to Portugal and legally paying near-zero on foreign dividends and investment income is over for new arrivals. If you’re a researcher, a qualified tech professional, or a startup founder, IFICI may genuinely suit you. If you’re primarily a passive investor, you’ll need to look at other structures — read my article on European tax structures for more on that.
Inheritance Taxes
There is no inheritance tax in Portugal, but stamp duty may apply to certain transfers of assets — including immovable property, movable assets, and securities located in Portugal — as part of an estate.
The position on cryptocurrencies specifically remains legally ambiguous. In the absence of explicit legislation or a binding ruling from the Portuguese tax authorities, there’s a reasonable argument that the relevant legal provisions don’t expressly foresee crypto assets, which could exclude them from stamp duty. That said, estate planning with crypto in Portugal should be assessed case by case, with all variables considered.
VAT
In a 2019 official ruling, the Portuguese Tax Authority confirmed the precedent from the Court of Justice of the European Union (Case C-264/14, Skatteverket v. David Hedqvist) to argue that although cryptocurrencies such as Bitcoin are analogous to a “means of payment” and therefore technically subject to VAT, they are exempt by application of VAT exemption rules consistent across EU Member States.
How to Buy Bitcoin in Portugal
You can use the world’s best crypto exchanges in Portugal without any problem. There are no limitations imposed by the country or by any of the major exchanges.
My suggestions:
You can also use crypto borrowing and lending platforms such as Nexo and YouHodler without any problems. Keep in mind that lending and staking income will be taxed at 28% in Portugal, so factor that into your calculations.
Even if your crypto gains are fully exempt from tax, you still need to keep good records and report transactions in your annual Modelo 3 return. A tool like Cointracker makes this a lot easier. See my article on crypto portfolio and tax preparation tools for the best options.
Crypto-Friendly Banks in Portugal
Please leave a comment if you have found a suitable crypto-friendly bank in Portugal. You can also have a look at the best European crypto debit cards that work in Portugal.
Buying Property with Crypto
Some real estate sales in Portugal have already been done using crypto. The most famous case is this one. I expect this to become more commonplace given the number of crypto people moving to Portugal.
Contact me if you want to buy property with crypto; I’ll put you in touch with my agent.
Golden Visa Investments
If you’re looking for good golden visa-related investments, I can put you in touch with a fund that invests within Portugal, and with an architecture firm that creates homes targeted directly towards satisfying the requirements of getting a Golden Visa. Just get in touch and I’ll put you through.
Participating in the Portuguese Crypto Community
You can follow this Twitter list that features many of the big crypto players that are based in Portugal. Please let me know about other crypto players and communities in Portugal by leaving a comment below or by contacting me.
Hard Fork Cafe is a cool YouTube channel dedicated to crypto, although you need to understand Portuguese for that. It’s a good way to practice learning the language though if you want to hit two birds with one stone.
Related
Hello,
thanks for this great blog.
I have some money in crypto, not as big as the previous poster is suggesting.
I moved to Portugal and I have a simple question:
Is it possible for me to exchange BTC to 3.000 EUR each month from Kraken to any bank account in Portugal ?
I don’t need to pay any tax or inform anyone with any kind of paper work as far as I understand, correct ? I just exchange it into EUR and use it to live my life here without sending any statements to the tax man ?
Thanks in advance
Would I be considered a “trader” and subject to that tax category B, if I only ever sell crypto? i.e never buy crypto?
I have a crypto stash of $3M and intend to convert $10k (or so) to Euro monthly to cover living expenses. It would be my sole source of funds.
Most probably not.
The EU is bringing in a new law to ensure that even the tiniest crypto transfers – even between private wallets- are to be scrutinised and, I presume, taxed.
Hi Jean,
I’m a US citizen thinking of moving to Portugal. After living there long enough to become a resident for tax purposes, if I sell some crypto am I still liable for paying capital gains taxes to the US IRS? I know there’s a tax agreement between the two countries to prevent double taxation, but since crypto gains aren’t taxed in PT, does that mean I’d still owe them in the US unless I renounce my citizenship?
Thanks
Hi,
Great article and discussion. I have few questions about living arrangements. Do I need to rent apartment for 183 days or more or is it enough to just stay in the country for that time? Should period of 183 days happen in a calendar year 1.1 – 31.12?
Hi Jean
Great write up.
I live in the states. I am looking at obtaining residence status in Portugal.
Do I have to use a crypto exchange in Portugal for the tax’s breaks or can I use the crypto exchange in the states to sell to obtain the tax savings in Portugal.
In other words do I need to transfer my crypto to Portugal and sell there?
Thanks
Patrick
There is no need to transfer your crypto to a Portuguese or European exchange for you to make the sale.
Hi,
So here is my case: I’m from the EU and I wanna move to Portugal after making substantial gains in Defi (yield farming). I’m talking a few millions.
But I wanna know what I can expect to pay in taxes there. Will I be considered as a professional and if so what % will I pay? I will invest in real estate but my main income will be from crypto.
Like I said I do Defi which means I do tens of transactions every day on the blockchain, but not on exchanges. I’m not a trader and this is only for me, not for others.
I have contacted a few tax lawyers in Portugal and so far I haven’t gotten a clear answer. All I got is them baiting me for very expensive consultations. Since I don’t have infinite amounts to spend (at least not yet since I obviously haven’t cashed out), I would like finally a clear(er) answer on the subject. I don’t wanna pay 15k for a fancy lawyer just to find out a year later that I’m taxed at 48%. No point in that. I will gladly do it though once I’m sure of what to expect.
It’s just that if I have to look at another country to retire, I’d like to know.
Thanks for your time and for that article.
Looks like you’ve been talking to the wrong lawyers. Contact me and I’ll set you up with an honest lawyer who knows this stuff.
Hey! Just wondered if the podcast you mentioned is out?
Also, what if, mainly by luck, crypto trading is your biggest income for a year, but wasn’t your main time-spent activity (say you have a fulltime job working 30 to 40 hrs a week & focus mainly on that, and just to 3 or 4 trades a week in your spare time but are lucky with the timing?)
Would that be taxable?
Thanks!
Be ready to pay 50%, Portugal tax can apply to crypto if the tax office wants it to, there are theories that they are waiting for all the cashouts and then present the 50% tax gift.
Easy to consider most people professional traders.
It’s not so easy to consider most people professional traders, you can look at how other countries consider them to anticipate how you would be considered in Portugal.
So, if anything, we would be looking at the 28% capital gains tax rate in Portugal. That would still be a big blow to the crypto community in Portugal though, as neighboring Spain has a maximum capital gains tax rate band that is actually inferior at 26%.
Under which article the taxes applied to the crypto, do you know ?
For what it’s worth, Santander Portugal told me that any transfers from crypto exchanges would result in the closing of the client’s account. Kind regards, James
Thanks for the feedback there, try Millenium or Nuri.
Hello Jean,
i would like to know what are the best way to cash out in Portugal, i have a bank account at Banco millenium.
On binance for instance, card from portugal are not supported.
thanks in advance !
If your only regular source of revenue is the rewards of staking crypto (falls into category E) and you get a decent monthly revenue from that (at least 700-2000€), is it possible to only pay taxes on those staking rewards revenues while the other crypto sales remain considered as personal incomes and non taxed (as long as they fit the criterias you wrote) ?
Then is it mandatory to have at least one category B income to be able to go to social security, or as long as you pay taxes on your category E revenue you are fine ?
Thank you very much, your article is the best by far I’ve seen on the internet on that complex topic.
Hello,
Thx for the overview.
Does a permanent resident in Portugal needs to declare his capital gains from crypto in his yearly taxation statement (IRS) although they are not taxed? Long time holding, no frequent trading.
Have you figure it out? Reporting crypto is a big burden
I’m unclear about something. Perhaps someone can help. I am an EU citizen (Ireland).
I understand that to qualify for 0% tax on any crypto profits one must reside in Portugal for 180 days in a 12 month period.
Does this mean I must have resided in Portugal for 180 days BEFORE selling my cryptos in order to avoid taxation on my cryptos profits?
Or does it mean if I move to Portugal next week and sell my cryptos next month that in order to avoid tax on crypto profits I would then need to continue to reside in Portugal after I have sold my crypto until I have accrued a total of 180 days in order to qualify for 0% tax?
Looking forward to a response.
You don’t have to reside before.
Excellant information. Thank you!
Hello Jean, in which cases they can consider you as a professional trader? I´m considering to move to Portugal before July, but this is the main doubt I have, I have done about 500 trades this year (2021), don´t know if I could be considered professional with these numbers. Do it depends on the number of trades, total amount of money earned…?
Thank you!
Great information- I’m hoping to move there in a few years and most of my retirement funds are in bitcoin and Etherium so hopefully I’ll be able to use my dividends from my crypto to live on . I plan on buying a house hopefully with my bitcoin.
Keep in mind that in a few years’ time crypto capital gains might be taxed at 28% like stocks, for example.
The current situation is a temporary one according to the opinions of several lawyers I’ve spoken to. We will see what happens.
Hi Jean,
This is really useful information, thank you. Will any funds need to be withdrawn to a Portuguese bank account? I made my initial investments before moving to Portugal and have just discovered this benefit so am trying to work out how to make the most of it.
There shouldn’t be any such requirement. The most important thing is to document everything meticulously.
Hi Jean. Can i declare crypto -funds as investment from 2015, and when convert it to EUR as capital gains without taxation? what is a maximum of these non-tax funds?
There is minimum or maximum when selling your crypto. There simply is no capital gains tax due on crypto at the moment in Portugal.
Great article! Very informative. Thank you very much much. I just sent an enquiry to speak with a lawyer as I have some questions and would love to make sure when I move there everything is ok.
You’re welcome.
Hey Jean,
thanks for that really comprehensive overview.
I just have one question – I am taking into consideration moving to Madeira and my trading activity would most likely be classified as a professional activity. But I’ve heard there is some rule for a special 5% tax rate in Madeira for businesses. Do you know whether and how this would also work for cryptocurrency trading?
I’ve heard about it but I’m not sure of the details there.
Hi Jean,
Thank you for all the info. I was wondering, do I have to become a tax resident in Portugal if I plan on withdrawing crypto gains to a Portuguese bank account?
I mean, would I have to be living there full time? My job is remote but would I have to move to Portugal full time to benefit from these tax advantages?
Thanks,
C
No, you don’t have to live in Portugal during the whole year. The NHR (non-habitual resident) program, allows citizens from is attractive to professionals, pensioners, investors and entrepreneurs who want to enjoy a life free of income tax. The government of Portugal offers tax benefits to everyone, with a unique advantage: no minimum stay requirement in the country.
You only have to meet one of the following requirements:
Hello and thank you for the useful post and comment section !
So if I apply for the NHR status and live on Madeira or Portugal mainland, the income from ethereum or cardano staking would be tax free right ?
Also do it also apply for income by crypto lending ?
Cheers,
Anton
I’ll cover these specific cases with a tax lawyer in an upcoming episode of my podcast, so stay tuned for that.
If you or anyone else have any more questions regarding taxation of crypto in Portugal just leave a comment here and I’ll base my questions to the lawyer off them.
The crypto space is getting more and more complex over time with the introduction of staking, lending, DeFi, NFTs etc and each of those need to be considered carefully for each country in question.
We will move fully to Madeira or Mainland Portugal and our source of income will be mostly from the profits of investing in Crypto IDO’s I did in the past. I will continue this kind of investing and taking profits out of it. Are those kinds of profits taxable in Portugal? Income from DeFi (providing Liquidity) is another source of income for us. Is this taxable too? Thank you
Can you please post the link here?
Can’t wait for the podcast you mentioned. Any ETA? 🙂
Especially interested about taxation of staking profits (ETH2.0, ATOM Cosmos etc.), lending interest (DeFi such as Compound, or CeFi such as Blockfi or Celsius) as well as yield farming (such as Sushi or KepperDAO). With the NHR programme.
If this is also tax-free, then I am ready to move to Portugal next year :). Or Madeira – love trail running.
My country (EU) does not have any exit taxes, so should be fine from that perspective. Only wondering, how the Portugal tax authority will look at documents if they show that the crypto has been acquired (and interest earned, staked, yield farmed) prior to moving there. How much documentation do you have to provide in your tax statements?
Thanks! 🙂
I’ll take note of all these questions for the podcast, it should be recorded and published within the next month.
Okay more Questions:
Do you need to register your Assets, even when you are not selling them in Portugal.
So for example: I move there and plan to live from cash, I just want to hold for a few years. Do I have report to the tax authorities: I have x amount of BTC, y amount of ADA and so on.
How is staking taxed?
– Not at all.
– When you receive the Staking Rewards?
– When you sell the Rewards against fiat?
– Is there a minimum hodl time to get tax free
How is Lending taxed?
When you are seen as professional trader? how many trades? what are the criteria here?
What if your income is from crypto only?
How you see the risk of high taxation or even forbidden on btc/crypto?
Would there always be a ramp-up time before laws fall into place, so everyone could leave if the situation change for the worst.
How someone can make it legally safe, at least for some time? So what laws are here important?
Thanks, keep them coming!
It would be great if you can also compare all these topics for residence and nhr people, if there is a difference and tax at all for any kind of crypto created income (staking, lending, mining, sale of coins).
Is it expected that there will be exempts for NHR in the future, for example:
New laws fall in place, NHRs will be probably exempt from these new laws or how was in the past with change of rules?
How can I find a Tax-Adviser/Accountant?
How much is a Tax-Adviser typically in Portugal and is it anyhow connected to the amount of taxes/income?
How much is a Accountant typically in Portugal is it anyhow connected to the amount of taxes/income?
How will the process work? I just sent my bank statements to an accountant? So, maybe here the full story could told? From first client contact to doing tax returns and chill 😀
How much work is involved with this for the client?
Is the Tax-Adviser/Accountant in legal charge if the client reported everything correctly to them, but the Tax-Adviser/Accountant missed an important part or even did not know it. Or is it always the client who needs to check it and understand it, because in the end he is still responsible.
Are there already living examples for staking taxes. Means People which have done there tax returns and the government said alright. We accept this, that and you are tax free or you have to pay this % for your staking rewards. Same question would be nice for lending, mining, but for me personally staking is the most interesting.
Is there the possibility to get cheated or are all Tax-Advisers regulated?
What kinds of quality signs can someone check to see: ahh okay this is a good one, this one is maybe not the best Adviser or Accountant. What Certificates are important and so on?
Thank you very very much, if I can get these information’s I will be very happy. I would love to come to your beautiful country, but I just don’t want to trap into trouble. <3
Very good questions Tim, I will cover them in the podcast.
Thanks for that. Another few:
Do I have to do tax returns at all or can you sell crypto and get it on my bank account and don’t tell the fiscal authority about it, because it will be anyway tax free.
How much cost a full package for the tax consultants on average per year.
So that we can estimate how much it would cost and the pricing is legit.
– Accounting
– Tax returns
– …
Looking really forward for the podcast. Thanks a lot!
Tim, what do you mean by the last question?
“How someone can make it legally safe, at least for some time? So what laws are here important?”
Hello,
I wondered if you have any information regarding the rules on double taxation in Portugal. More specifically, what I mean is, let’s say I bought and HODLed a cryptocurrency outside of Portugal, and then I moved to Portugal before selling in the bid to avoid cryptotax: do you know if I would still owe my country of origin any tax after selling my cryptocurrency as a Portugal tax resident? Or how long it would take to cease to owe my country of origin any tax in this instance?
Thank you!
You’d have to speak to a tax lawyer in your country first, since some countries have exit taxes and special provisions to try to prevent their citizens from making tax optimising moves like this one.
Hi there,
I enjoyed the article very much,
I will be moving to Portugal soon & my income is from dividends
paid to me in btc. Which is the best crypto exchange to use in Portugal with the Santander bank for the frequent selling & cashing out?
Thanks.
Congrats on managing to get dividends paid in BTC, I think you should be able to use any of the well-known exchanges like Coinbase, Kraken, Binance etc.
I hear lots of portuguese banks make it difficult to cash out of an exchange, is there any banks which are especially crypto friendly ?
Moving in 3 weeks 🙂
BBVA and Santander should play nice with exchanges, but in the case of big amounts it’s always better to talk to them before making any transfers to make sure that you will have the documentation they will most probably ask you for.
Hi Jean
Thanks for this article on crypto tax in Portugal.
Lots of very helpful info, much appreciated.
Have sent you an email too re any recommendations for a crypto tax lawyer in Portugal.
Have a great day
James
Welcome, will put you in touch.
Thanks for this article, seems almost too good to be true!? Could you forward the tax lawyer to me too. Thanks.
Thank you so much for the great article!
Sylvain, how did you sign up in Portugal? Are you “normal” citizen or did you go for “NHR” more beneficial sign up? I think this is the most unlcear thing to me right now and Im about to move there next week possibly?
The Bank advise of Santander was great!
From what i understand its a bit unclear who is pro trader or not?
I also just read trough the important parts of MICA (EU regulatory crypto) and it seam like its minimum 1 year away for anything so this bullruns profit would be safe from what i understand anyway.
Hey Janne,
I am not a portuguese citizen, I came here under the NHR status last july.
Regarding Estelle comment, don’t you think that Yield farming could be seen as capital gains by the tax authority ?
For anyone arriving who was not a Portuguese resident in the last 5 years, you qualify for the NHR program. Non-habitually-resident is a tax status and your passive income will be taxed 0% (if it is truly passive, in the above case, interest from yield farming would have to be declared in your Portuguese tax filing, but would be tax-free). Note that under NHR you have to declare your worldwide income, but you won’t be taxed on anything passive. I don’t think a one-time HODLers gain is deemed professional trading. NHR is good for 10 years. I think we are ok with regs in Portugal at least until MiCA comes into force which will affect the entire EU, and will include or prompt tax reform I imagine… so 4 or 5 years.
What’s MiCA Estelle?
It’s Markets in Crypto Assets regulation https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A52020PC0593
Hi Jean,
Fantastic write up , I have NHR status in Portugal and live in vilimoura, can you please recommend a good tax lawyer regarding crypto,
Thanks 🙏
Thanks Kevin, contact me via email and I’ll put you in touch.
Very good comments. will need also name of layers for Crypto.
Can you give me your email address for a few questions.
Thank you.
Best Regards,
Teresa Afonso
Leave all questions as a comment here please and I will address them in an upcoming podcast with a Portuguese tax lawyer.
Thank you very much for this detailed article.
I moved in Portugal recently and I thought there was no tax at all but I understand it is a bit more complicated than that. I undersrand from your post that if you are a day trader you will pay taxes bit what about if you are an hodler and make millions ?
Lets say I bought 30 bitcoins in march 2020 at 4000$ and I sell them at 60k$ for a benefit of 1 680 000$. Will I have to pay taxes as it will be my main source of income ?
Same questions if I bought like 20 others cryptocurrencies and make a huge profit by just holding them ?
And last question, what about yield farming on stable coins like usdc ? Let’s say I sold my 30 btc for 1 680 000 usdc and I put this money on yield farming and get 10% (168 000$) of interests every year. I guess it could be considered ad capital gains but how is it in reality ?
Thank you 🙂
Hi Sylvain.
According to my understanding of the subject:
In the first case, no, you don’t have to pay any taxes, even if it is your main source of income for this particular year. It’s obvious that you were holding and eventually sold because it was convenient for you to sell, but you’re not a professional trader.
I’ll get back to you on the second case as I need to confirm a few things first.
As always, I have to say that I’m not a tax professional and you should therefore contact an accountant or tax lawyer in Portugal before submitting your tax returns.
Hi Jean,
Thank you very much for you answer. Of course I will talk with my lawyer regarding this matter but I like to gather information on my own first ;).
Is there any likelihood of Portugal changing it’s beneficial Crypto tax laws in anytime soon, e.g in 2021?
I’m just conscious of the fact that Portugal, being an EU member state, could potentially be pressured to amend its tax laws if the EU wanted to harmonise them across Europe.
I only mention this because when someone mentioned the favourable Crypto capital gains tax laws in Portugal on an online chat, and a couple of them responded, “for the time being”…
The reason they say that is that Portugal did not specifically put in tax law that states that crypto gains are not taxed. Rather, the ruling is based on a technicality in the existing law whereby crypto gains do not fall into any of the explicit classifications of assets that are taxable.
On the other hand, the fact that there is an official ruling on this is already a very positive thing, as many other countries have dragged their feet in even pronouncing themselves on the topic. There are also several other European countries with favorable crypto taxation, for example Germany and Malta, where long-term holdings are also tax-free.
Tax harmonization in Europe is a pipe dream in my opinion and can never happen. The smaller and weaker countries practically all have significant tax benefits that they use to attract foreign investment, and a harmonized tax system would destroy their economies and make them much less attractive.
You can see this tax play all around the world, for example with barely known Caribbean countries offering tax advantages, or certain “unattractive” states in the United States also offering low taxation and low regulatory pressure.
Having said that, there are plenty of rumors that the Portuguese government will make crypto gains taxable at 28% in the next budget, so it’s basically a waiting game.
I would be cautious about moving to Portugal only for this benefit, since it can change at any point. There are other countries like Malta that might be better for long-term holders who want to cash out, since they have specific laws dealing with cryptos. Germany is another ideal country as holdings beyond one year are not taxed when sold.
Portugal’s biggest attraction is the NHR-programme. The fact that crypto sales are not currently taxed is just the cherry on the cake.
Hey any advice on which Portuguese bank is crypto friendly (or which to avoid)? I just moved here.
Try BBVA or Santander.
I am using Santander and no problem so far. It is a good bank that I would recommend
Great information. I’m wondering what other countries might follow in this path? Also, you must try beach tennis ! https://youtu.be/QacR5DWINtA
Let’s hope more countries follow. I also play beach tennis 🙂