The Danish government has published a statement announcing that it will be soon launching a tax regime for crypto trading – meaning crypto activity in Denmark is about to get its own tax bracket. It’s estimated that Denmark lost out on more than $15 million in taxes in the period between 2015 and 2017. This is being put down to Danes using Finnish crypto exchanges and not declaring the correct amount of tax payable.
Danish Crypto Tax Currently Extortionate
In Denmark, crypto traders are currently declaring their crypto tax at the same rate as their income, meaning they could lose up to a whopping 53% to the tax man. This has left many crypto traders being rather cautious over how much crypto tax they are declaring to authorities. Fortunately, the recent bearish market has left many Danes able to claim capital loss, meaning they could get pushed down into a lower tax bracket and obtain a refund from the tax paid on their day job.
UK Launching Crypto Tax guidelines
Her Majesty’s Revenue and Customs (HMRC) in the UK has decided to launch crypto tax guidelines, to ensure that all British crypto traders pay the correct amount of tax come tax season. If a trader has more than £500 worth of trade activity, it will be considered trading and will be eligible for capital gains tax. On top of this, if people earn a wage in crypto, they will now be eligible to pay taxes and their national insurance contributions. For a long time earning in crypto was seen as a way of dodging taxes in the UK. However, now HMRC has legitimized the revenue stream and imposed the same regulations as you would see in standard currency earnings.
Overstock Paying Taxes in Crypto
If citizens needed a large company to go first, they finally got the signal they were waiting for. Overstock has become the first company in the US to start paying part of its annual tax bill in cryptocurrency. Many Bitcoin bashers claim that BTC is a way to evade taxes, but this move from Overstock throws these claims out the window. Finally, Bitcoin is being shown to be a legitimate currency and will help with the long-term adoption of digital currencies.
While the news that Denmark is going to impose its own tax laws might not please everyone, it will certainly please Danish crypto traders. Under the new tax laws, Danish traders should be able to pay less than 53% on their trading activity – providing they make a profit of course.