Portugal, a former tax haven, has recently announced a short-term 28% tax on crypto profits.
For a long time, Portugal has been the best destination for international crypto investors. Portugal previously granted flexible visa options as well as tax benefits for cryptocurrencies (0% tax on cryptocurrency earnings!)
However, Portugal recently proposed a tax policy that would take effect in 2023: Gains made in cryptocurrencies within a year will be subject to a 28% capital gains tax.
The crypto-generated income held for more than a year will be immune from tax.
Additionally, the Portuguese government plans to levy a 4% tax on cryptocurrency transfers between individuals.
Now that Portugal is no longer a tax haven, let’s look at some alternative options:
Private investors will not have to pay capital gains tax on their cryptocurrencies.
But, companies and self-employed traders would have to pay capital gains tax.
Some conditions must be met:
Crypto assets must be held for at least 6 months.
The turnover must be less than “5 times your share”.
The net capital gain must be less than 50% of your total
Since capital gains are not taxed in Singapore, capital gains obtained from the purchase of cryptocurrencies for long-term investment reasons are not subject to tax.
However, you will be taxed if you regularly trade cryptocurrencies.
United Arab Emirates
Dubai has a personal income tax of 0%.
There is no personal income tax if you are a tax resident in Dubai, regardless of how much you earn!
There are also no taxes on capital gains, whether you actively trade or only hold crypto assets.
Slovenia has a flat-rate tax proposal on crypto refunds
It has a flat fee of just under 5% for cryptocurrency transactions and also when they are sold or traded.
Citizens and foreign nationals do not pay taxes on personal income or capital gains.
The Bahamas also allows individuals to pay other taxes using cryptocurrencies instead of traditional fiat payment methods.
Malta has a complicated cryptocurrency tax system
“Blockchain Island” has no capital gains tax on profits made from cryptocurrencies held long-term
However, crypto trading in Malta is subject to a 35% corporate income tax.
Residents of Puerto Rico who buy and sell cryptocurrencies are not subject to capital gains tax.
However, you must follow the tax laws of your home country for any cryptocurrency purchased outside of Puerto Rico.
El Salvador was the first nation to accept BTC as a legal tender.
Foreigners are not required to pay taxes on any income they earn from their crypto earnings.
Taiwan does not charge taxes on capital gains.
Crypto trading, on the other hand, is treated as property transaction income and must be reported as individual income for tax purposes.
These are the best tax havens available to crypto investors. Since crypto is a new technology, countries frequently change their tax policy. Therefore, it is advisable to consult a tax advisor before deciding on a new country to move to.