Since 2023, Portugal has had clear rules governing the taxation of crypto-assets. The former ‘legal loophole’ no longer exists, and we now know when tax is due – and when it is not.
Here are the key points.
What counts as a crypto-asset?
They are digital representations of value, such as cryptocurrencies (e.g. Bitcoin), stablecoins and other tokens that can be transferred electronically.
NFTs (unique, non-fungible tokens) are not included in this regime.
When is income tax payable on crypto-assets?
It depends on how you use them.
- If you receive your salary in crypto
If part of your salary is paid in crypto-assets, that amount is taxed as normal employment income.
The market value on the date you receive the crypto-assets is used.
- If you carry out professional activities involving crypto
If you engage in frequent trading, mining or organised activities for profit, the income is taxed as business activity (Category B).
The standard personal income tax rules for self-employed individuals apply here.
- If you receive passive income (staking, lending, etc.)
Income such as staking or interest on platforms is, as a general rule, taxed at a rate of 28%, unless you opt for the lump-sum scheme.
- If you sell crypto-assets as a private individual
Here is the most important rule:
If you hold the crypto-assets for 365 days or more → you do not pay capital gains tax.
If you sell them before one year has passed → the capital gain is taxed at 28% (unless you opt for the lump-sum method).
Exchanging one cryptocurrency for another does not trigger immediate tax liability. Tax is only payable when you convert it into cash or use it to purchase goods/services.
Change of residence
If you cease to be a tax resident in Portugal, the so-called ‘exit tax’ may apply, which could result in tax being payable on crypto assets held at the time of departure.
What about other taxes?
- Donations or inheritances of crypto may be subject to Stamp Duty (10%).
- If you use crypto to buy a property, the value is included in the calculation of the Property Transfer Tax (IMT).
In summary
The rules exist – but taxation depends on three key factors:
- Type of income
- Holding period
- How the activity is carried out
Each case may have important nuances, particularly in international transactions or where there are various types of income.
Contact us to find out more.
