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February 3rd, 2023. Tax deadlines are looming around Europe, leaving many investors wondering how much tax they’ll need to pay on their crypto profits from 2022. That’s why we’ve teamed up with Koinly to give you a quick tour of crypto tax rates around the world.
How much crypto tax will I pay?
An obvious question with a fairly obvious answer - it depends on where you live, your country’s tax rates, and how your country taxes crypto.
Of course, that answer isn’t actually particularly helpful, so let’s take a quick look at crypto tax rates around the world, including:
- The UK
How much crypto tax will I pay in the UK?
There are two different tax rates that might apply to your crypto in the UK, depending on your specific transaction - Capital Gains Tax or Income Tax.
You’ll pay a Capital Gains Tax of 10% or 20% on capital gains whenever you sell, swap, spend or gift crypto (excluding to your spouse). But you do get a rather generous £12,300 tax-free allowance until April 2023. This allowance is set to halve in the next financial year, so keep that in mind.
Meanwhile, you’ll pay Income Tax between 20% to 45% on any income from crypto - like mining rewards, staking rewards and a variety of other activities where you earn new tokens. Each taxpayer does, however, get a tax-free allowance on personal income and you may be able to utilize the £1,000 trading and property break allowance as well for the 2021 - 2022 financial year.
How much crypto tax will I pay in Switzerland?
A few different taxes may apply to crypto in Switzerland - meaning a few different tax rates! It all depends on whether you're viewed as a private investor or a self-employed trader as to the tax you'll pay.
If you're a private investor, you'll potentially pay Income Tax and Wealth Tax on your crypto. Income Tax is made up of three different taxes (Federal, Canton and Municipal) - so your overall rate may vary. In 2023, for Federal Income Tax you'll pay between 0.77% to 11.5% on crypto income like from mining or staking rewards, earnt in 2022, plus your relevant Canton and Municipal tax rates.
You may also be liable to pay Wealth Tax on your crypto depending on the total value of your assets. The Wealth Tax rate varies from canton to canton but is between 0.3% to 1%. Most cantons have a Wealth Tax exempt allowance, which is generally around 100,000 CHF as of 2023.
How much crypto tax will I pay in Germany?
Crypto is subject to Income Tax in Germany - but there are lots of scenarios where you won't actually pay any tax on your crypto profits.
Only short-term capital gains (from crypto held less than a year) are subject to Income Tax, as well as a variety of other transactions where you earn new coins like mining rewards, staking rewards and more. In 2023, if you are paying Income Tax on your 2022 crypto gains, you'll pay between 14% to 45% in tax depending on how much you earned overall.
However, if you hold your crypto for more than a year before selling, swapping or spending it, you'll pay no Income Tax on your crypto. As well as this, in 2023 you get a short-term gains allowance of €600 and a miscellaneous income allowance of €256.
How much crypto tax will I pay in France?
There are a variety of different tax rates in France, depending on your transactions and how you're viewed as an investor.
Occasional traders will pay a flat tax of 30% on income from financial investments like crypto, in 2023. Meanwhile, professional traders and crypto miners will pay a flat tax of 45% on income from financial investments like crypto.
It sounds steep, and it is, but the good news is the DGFiP only views sales of crypto for fiat currency as a disposal, so if you're swapping crypto for crypto, you won't need to pay tax on gains from these transactions.
How much crypto tax will I pay in Austria?
Austria recently had a crypto tax reform, which means there are a few different ways your crypto may be taxed depending on when you acquired or purchased your crypto.
Prior to the reform (so for crypto acquired ahead of the 1st of March 2022), you'll pay Income Tax on short-term profits when you sell, trade or spend crypto, as well as Income Tax on mining rewards. These tax rates vary between 0% to 55% depending on how much you earn.
There is also what's known as an "interest-bearing tax rate" of 27.5% that applies to crypto transactions like staking crypto, lending crypto and more.
From the 1st of March 2022, all crypto transactions instead are now subject to the stock tax rate, which is a flat 27.5% and long-term gains are now also subject to tax, with the exclusion of legacy holdings.
Legacy holdings refer to crypto you bought prior to a particular date. Crypto you acquired or bought after the 28th of February 2021 is subject to the new rules, while crypto you acquired or bought before the 28th of February 2021 is subject to the previous rules.
It's not all bad news from the reform either. It also means trading crypto for crypto is now tax-free and staking rewards from direct participation in a consensus algorithm are now tax-free upon receipt.
How to calculate and report your Lykke taxes
Now you know how much you’ll pay on your crypto - let’s look at how to do your crypto taxes in five simple steps with our partner Koinly:
- Connect Lykke to Koinly. Upload a CSV file of your Lykke transaction history to Koinly. Learn more.
- Connect any other wallets, exchanges and blockchains to Koinly. Koinly supports more than 700 exchanges, wallets and blockchains, making it easy to connect and do your crypto taxes in no time at all.
- Grab a coffee and let Koinly do its stuff. Koinly uses AI to go through your entire crypto transaction history and identify which transactions are taxable and which aren’t according to your settings. Then it’ll calculate your cost basis, capital gains or losses and the fair market value of any crypto income on the day you received it, saving you hours of spreadsheets.
- Download your crypto tax report. Upgrade to a paid Koinly plan and download the tax report you need, when you need it. Koinly can generate a huge variety of reports for users around the world including the HMRC Capital Gains Summary, Swiss Valuation Report and Complete Tax Report, suitable for filing in more than 20 countries.
- Use your crypto tax report to file your preferred way. Hand your report over to your accountant, upload your crypto tax report to your tax app or file using paper forms.