Portugal has been in the spotlight for quite a while with its cryptocurrency regulations. Lots of incentives have been introduced until now. Today, many cryptocurrency dealers are benefitting from these incentives now.
Before delving into details about these regulations, here are the short bits about Portugal crypto tax:
- In Portugal, you’re not subject to value-added-tax (VAT) out of your bitcoin earnings
- There are a few legal works you need to deal with for your cryptocurrency enterprises
- Portugal keeps attracting many overseas entrepreneurs thanks to its crypto-friendly steps
- In Portugal, cryptocurrency earnings are not included in categories like capital gains, capital yields, or self-employed workers. This is why the tax regulations of Portugal crypto are different.
If you wish to learn more about the Portugal crypto tax, you can check the following sections.
Taxation and Cryptocurrency in Portugal
You’ll not be subject to VAT when you make cryptocurrency transactions. This means that buying and selling cryptocurrency does not entail VAT either. When you get Portugal crypto gains through the sale or acquisition, VAT doesn’t apply.
Portugal also offers you the opportunity to be paid in cryptocurrency, and to pay with crypto visa cards.
Note that you’ll be subject to taxation when you obtain income or trade from professional activities. Companies providing cryptocurrency services are also subject to taxation on their capital gains. If your main source of income is through trading bitcoins, then you’ll be subject to taxes. Otherwise, bitcoin trading can be tax-free if you do not do this regularly. It’s still advisable to consult a tax lawyer about your situation.
About the Economic Situation in Portugal
According to the recent report published by Ernst & Young, Portugal is among the 10 best countries to attract FDI. It also ranks the 4th safest country globally. These two factors are among the reasons overseas investors and entrepreneurs choose Portugal as an alternative destination.
The residency by investment program in Portugal has a considerable impact on the country’s economy as well. Since 2012, the Golden Visa program has brought an inflow of more than €6 billion into the country. This also meant a contribution to the growth of the real estate market in Portugal as well.
How To Benefit From Portugal Crypto Tax
Moving to Portugal as a Portugal crypto trader is possible through certain programs. These include the D7 Visa and Portugal Golden Visa.
The Golden Visa in Portugal provides residency rights for qualified investors and their families. The program is suitable for citizens outside of the EU, EEA, and Switzerland. Through this program, you can also get citizenship after five years upon following the necessary steps. The Golden Visa Program allows you to live, work, and study in Portugal.
Another way to move to Portugal is through the D7 Visa, also known as a passive income visa. Cryptocurrency traders can benefit from the D7 Visa as well. You can be eligible for this visa if you obtain income from real estate, pensions, or transferable equity. You can also apply for citizenship under this program after five years.
Non-Habitual Resident (NHR) Program for Tax Benefits
The NHR Program in Portugal is a way to become a tax resident in Portugal and benefit from tax exemptions. This means that you need to spend at least 183 days in Portugal to benefit from the program’s advantages. To be able to apply for the NHR scheme, you must not have been a tax resident in Portugal in the previous five years. Also, you need to have the right to reside in Portugal. The Golden Visa program can ease this process for you if you’re not a Portuguese resident.
So, crypto traders can benefit from Portugal crypto tax through the NHR program. The reason is that NHR offers tax exemptions on much of your foreign income. So, these exemptions can apply to the taxes on your cryptocurrency earnings as well.
In short, Portugal crypto tax offers advantages to anyone who decides to move to Portugal as a crypto trader. Certain tax breaks and residency rights are other advantages you’ll enjoy once you apply for the Golden Visa.
Also, note that consulting a specialist is a good idea before you complete your application for these programs. A professional will work elaborately regarding your tax issues and questions.