Everything on Earth has been taxed until now (at least since the dawn of civilization), let it be any country, any place, anytime. We’are gonna tell you some of those Countries That Don’t Tax Bitcoin, Ethereum, Monero, or others Cryptocurrencies. They are Cryptocurrency Tax-Free Countries which you must know if you are investing in cryptocurrencies like bitcoin. There are various types of taxation system on bitcoin because of the fact that every country considers the bitcoin income in different terms. Some consider it as a commodity, some as an asset and other as an income.
Before moving ahead, let’s clear out some concepts: commodity, asset, and capital gains tax.
Commodity
A commodity is something with you buy and sell.
Asset
An asset is a resource with economic value that an individual, corporation or country owns or controls with the expectation that it will provide future benefit.
Capital Gains Tax
Tax on the gain that arises from the sale of a ‘capital asset’ (land, building, house property, vehicles, patents, trademarks, etc.) is a capital gain. This gain or profit is charged to tax in the year in which the transfer of the capital asset takes place.
Let’s start with our List of Bitcoin/ Cryptocurrency Tax Free Countries.
1) Germany
The economy of Germany is the largest national economy in Europe and the fourth-largest by nominal GDP in the world, and fifth by GDP(PPP). The economy of Germany has highly developed the social market economy.
In Germany, bitcoin is not considered as a commodity, an asset but it is considered as a private money same as a foreign money. If you buy a bitcoin you have to keep it for a year you will be exempted from tax, but if you sell it before, then you profit should not exceed 600 EURO or else you will be taxed for the same.
2)Denmark
The economy of Denmark is the 39th largest national economy in the world, when measured in terms of nominal gross domestic product, and 60th largest in the world measured by purchasing power parity (PPP).
Denmark has always been known in the world for its nature in creating a cashless economy. Along with a few countries, Denmark wants to completely get rid of cash.
‘Denmark may become the world’s first cashless country’
The country will always be benefitted because of its attitude toward technology and its bitcoin-friendly nature. It is the first country which declared Bitcoin trading to be tax-free. It’s one of the best Cryptocurrency Tax Free Countries in the world. In March 2014, the Central Bank of Denmark announced that Bitcoin cannot be considered as a currency. As a first step, the tax authority has to decide whether using bitcoin constitutes any speculation. Authorities now feel a need to review their policy which firstly considered bitcoin wasn’t a currency, meaning it initially wasn’t possible to tax under capital gains rule.
3)Slovenia
Income made by an individual is always subjected to tax, irrespective of its form. Tax applies on the basis of the transaction on bitcoin exchange. However, personal income tax is not paid on capital gains. Hence, individuals who generate income by selling bitcoins will not pay income tax.
However, bitcoin miners will have to pay the tax on their income as mentioned in the provision of Slovenian personal income legislation. Profits gained by miners will be taxed. The picture is still unclear about the taxation of businesses involved in bitcoin trading.There is much of an ambiguity created here as the treatment of bitcoins in the accounting process varies on a case-to-case basis.But for these small economies, it is possible to consider these cases individually and independently.
4)Belarus
IT sector in Belarus is getting pretty strong and you are using some apps that you have no idea they originate from Belarus for example Viber. We can say this country has made bitcoin tax-free in real terms.
“Individuals will be able to store, change, buy, donate, bequeath, mine, and also exchange cryptocurrencies and tokens for fiat currencies,” Rusbase elaborated. In addition, it is not necessary to declare cryptocurrency profits and income from their operations since they are tax-free until January 1, 2023. Belarus has created unique conditions for the world to regulate the sphere of cryptocurrencies, both for ordinary citizens and for companies and investors in this sphere.
We’ve just seen the Countries That Don’t Tax Bitcoin. Now if you are thinking of not letting any of your profits you earned via bitcoin, then I have another list of countries where you can enjoy every single penny you earned. These are the countries where you are not subjected to pay tax. You can enjoy your hard earned money to its fullest.
Complete Tax-Free Countries in the world
5) Bahamas
The Bahamas has no income tax, they choose to earn from tourism. Residents of the Bahamas pay zero tax on money they earn anywhere in the world.In case if you think it is some small unstable country you may be wrong, its passport is actually one of the 25 best in the world.
6)British Virgin Island
The economy of the British Virgin Islands is one of the most prosperous in the Caribbean. Although tiny in absolute terms its economy is based on two pillars one is finance and second tourism. It is a country will small population. Obtaining a residence visa as a self-sufficient person is quite easy and can be obtained in less than a month in most cases
7)Monaco
This is country bordering Italy and France and is part of the gorgeous French Rivera and is well connected by trains, airplanes, and helicopter to the rest of Europe.The state has no income tax and low business taxes and thrives as a tax haven both for individuals who have established residence and for foreign companies that have set up businesses and offices.
8) Vanuatu
Vanuatu’s economy is primarily agricultural; 80% of the population is engaged in agricultural activities that range from subsistence farming to smallholder farming of coconuts and other cash crops.This is one of the few tax-free countries where obtaining citizenship is possible and the offer rewards for those who invest more.
Look for an option that you make like and work for getting citizenship for that country and enjoy bitcoin trading to its fullest.
Let’s revise our List of Bitcoin, Cryptocurrency Tax Free Countries.
- Germany
- Denmark
- Slovenia
- Belarus
- Bahamas
- British Virgin Island
- Monaco
- Vanuatu