In 2023, Portuguese taxpayers took a significant step towards fiscal transparency in the crypto asset sector. According to data from the Ministry of Finance, released by Expresso, over 500 residents in Portugal declared €57 million in capital gains related to the sale of crypto assets, reflecting the impact of new tax rules introduced in the 2023 State Budget.
🧾 The New Tax Framework
Portugal, which for years was dubbed the “Crypto Eldorado” due to the absence of specific taxation, now applies a 28% tax on profits from crypto assets sold within 365 days of purchase. However, assets held for more than one year remain tax-exempt — a measure that aims to align crypto assets with the regime applicable to other securities.
💰 Who Declared and How Much?
- 507 taxpayers reported sales of crypto assets held for more than one year, totaling €84.3 million, which generated €56.8 million in capital gains, exempt from taxation.
- Operations with tokens sold before 365 days of possession were negative in terms of capital gains: 51 taxpayers reported losses.
- 99 taxpayers declared €2.13 million as professional income (Category B) obtained from crypto assets.
- Another 13 taxpayers reported mining income totaling €27,733.
🧑💼 Professional Income and Tax Interpretation
The president of the Order of Certified Accountants (OCC), Paula Franco, explained that Category B income does not depend on the origin of the crypto asset, but rather on the professional and habitual nature of the activity. This means that those who regularly operate with crypto assets may be considered sole proprietors and subject to specific taxation rules.
⚖️ Challenges and Uncertainties
Paula Franco also highlighted a grey area in the current legislation: there is no clear distinction between crypto assets that are considered securities (like stocks) and those that are digital currencies. This distinction directly affects the obligation to declare capital gains. The president argues that it is up to the transaction platforms to identify this nature, as investors can hardly do so themselves.
📌 Conclusion
With the new tax framework, the Portuguese State seeks to balance attracting investment in crypto assets with greater transparency and fiscal fairness. For investors, especially those operating professionally, it is fundamental to understand tax obligations and distinguish between short-term and long-term operations. FA Accounting is available to help clarify doubts about crypto asset declaration, applicable tax regime, and good tax compliance practices.
If you need support in managing crypto asset taxes or correctly preparing your IRS declaration, speak with the specialists at FA Accounting.
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