Portugal Tax Authorities Clarify That Buying & Selling Cryptocurrency Is Tax-Free
In contrast to the United States, the Portuguese Tax & Customs Authority (PTA) have announced the buying and selling cryptocurrency in Portugal is tax-free, and therefore not subject to capital gain taxes or VAT.
There are exceptions, for example the use of cryptocurrency in exchange for goods or services doesn’t change the tax treatment required on the original transaction, and taxpayers who deal in cryptocurrency as a professional or business activity are still subject to certain taxes.
The announcement is in line with the motion that Portugal will treat cryptocurrency just like any other form of currency, effectively making it exempt from VAT and capital gains.
In contrast, since 2014 the US has treated cryptocurrency as a capital asset as it can be converted into cash, this means that‘capital gains’ rules apply to any gains or losses which are associated and tax must be paid on these gains.