Income 2021 starts and this year we have news with cryptocurrencies. Here we explain how we must declare them and what changes the Treasury has introduced. A guide to know what our obligations are regarding cryptocurrencies, in which case we are exempt from reflecting them and what we must take into account.
Having cryptocurrencies does not imply declaring them. The obligation arises when they are sold. As with stocks, the fact of having cryptocurrencies does not imply that we have to pay taxes on them. Obligations come when we make a profit, usually because we sell them. That is, if we have bitcoins in an exchange but they have not brought us profits (for example with staking) nor have we reversed them, then it is not necessary to incorporate them into the Income.
If income exceeds 1,000 euros. Another figure that is good to keep in mind is the margin of one thousand euros. If our income last year was less than this figure, there is no obligation to account. Of course, all operations count, both nationally and abroad. And in case of exceeding, even minimally, this figure, we must declare all the movements with virtual currencies. In the case of losses, it is optional, but it is recommended to incorporate them since they can act in our favor.
The four sections where to declare cryptocurrencies. Depending on the type of movement, we must declare it in its corresponding section. Here are four well differentiated options.
- Gains and losses by transmission: for the sale and exchange of cryptocurrencies.
- Capital returns: interest, stacking and returns generated by having cryptocurrencies.
- Earnings and losses without transmission: airdrops, referrals, prizes and coins that we have obtained without buying directly.
- Economic activity: mining, trading or sale for third parties.
The cryptocurrency box. For cryptocurrency sales and exchanges, a dedicated box has been created for the first time, 1626, to report on ‘Balances in virtual currencies’. Within the section “Capital gains and losses derived from the transfer of other patrimonial elements”. In other words, in this box we will put the sales and exchanges, but in the case of interest or staking, they must be included in the ‘Gains and Losses that do not derive from the transfer of assets’ section.
how many taxes are paid. The first and fourth sections are taxed in the general part, so taxes will range from 18% to 47%. In the case of interest and earnings without transmission, we have 19% up to 6,000 euros; 21% between 6,001 and 50,000 euros; 23% for less than 200,000 euros and 26% for gains of more than 200,001 euros.
Wealth Tax (in addition to personal income tax). Here there is an additional obligation, although it depends on each autonomous community. It is a complementary tax, which is presented together with the Income with form 714. The idea is that if the amount of cryptocurrencies that we have (along with our assets except habitual residence) exceeds a certain amount, it must be declared and a tax. The Spanish average is around 600,000 euros.
In the case of Wealth Tax, a specific box, 46, is also included to report on Balances in virtual currencies.
Around with Model 720 (for abroad). Another model beyond rent is the 720. The Superior Court of Justice of the European Union declared that some aspects were illegal. As a result, the Treasury decided to modify it. This is a declaration on goods abroad, where cryptocurrencies are also included. However, if we have less than 50,000 euros, we are not obliged. It is recommended to do so to those who have assets valued at more than 50,000 euros, have already presented the Model 720 in previous years and have used platforms such as Revolut, DeGiro or eToro to invest.
Image | Kanchanara
George is Digismak’s reported cum editor with 13 years of experience in Journalism