Which countries have new rules in 2023?

Global regulators are still devising plans for dealing with cryptocurrencies, which operate differently from conventional financial assets. Some nations have accepted crypto and implemented regulations. Meanwhile, others have taken a more cautious stance due to concerns about fraud, money laundering and market volatility. Authorities have taken several steps affecting crypto holders, including passing new tax laws. As we approach the end of a new fiscal year, let’s look at some of the tax changes that have occurred in various countries regarding crypto.

Crypto tax changes from 2023

Portugal:

Crypto used to be untaxed in Portugal until the end of 2022. Nevertheless, the country remains very friendly to the asset class. Cryptocurrency assets sold after being held for less than a year are subject to a capital gains tax of 28%. The best part is that cryptocurrency held for more than a year is exempt from capital gains tax. That’s why Portugal is great for long-term hoarders. Mining and frequent trades are examples of commercial activity and will be considered self-employed and subject to social security and income tax.

Great Britain:

The UK is the latest nation to tighten its crypto taxation regulations. The country will include a new, distinct category for crypto assets on its tax returns starting with the 2024-2025 tax form.

Net profits will be subject to income tax at 20%, 40% and 45% if you reach the trading level. The tax rate will depend on which income bracket it falls under. The UK government estimates that starting in the 2025-2026 financial year, this shift in crypto reporting will generate £10 million ($12 million) annually.

Hong Kong:

Hong Kong intends to adopt new regulations in June that will require cryptocurrency trading platforms to obtain licenses from the Securities and Futures Commission. In its proposal to regulate trading platforms for virtual assets, the agency has already started a consultation process. However, cryptocurrencies are not considered taxable assets in Hong Kong.

Tax-free countries

Apart from Hong Kong, there are several other countries where there is no tax on crypto. Switzerland, Singapore, Bermuda and Dubai are some of the popular destinations for crypto traders to operate without paying capital gains tax.

Puerto Rico is another popular destination, especially among Americans. If Americans seek residency in Puerto Rico, they can benefit from paying 0% capital gains tax in exchange for paying Puerto Rico 4% of their income. Because of this, wealthy Americans have flocked to the island in large numbers.

Belarus on the other hand is popular among Europeans. The government has decided not to tax crypto activities, such as day trading and mining. Furthermore, there is no corporation tax on the currency. It should be noted that this legislation was designed to be in force until 2023, and it is unclear how this may change over time.