Nearly all countries permit the use of cryptocurrency as a financial, business and ordinary means of payment. I am talking mainly about the leaders of world economies, such as the USA, Russia, China, Japan, Canada and Germany. In these countries, bitcoin can be used to buy both real estate and coffee at a bar. Even the Swiss Zug is already called “crypto valley” because there it is possible to pay municipal taxes with cryptocurrencies.
The above considerations only indicate the instability of the Polish tax law system concerning economic activities related to cryptocurrency trading. The tax authorities change their minds like in a kaleidoscope, which does not inspire confidence in taxpayers. Most of them do not currently have any practical information on how to settle cryptocurrencies with the Treasury. However, there are countries, such as those mentioned above, that are friendly to cryptocurrencies and economic activities conducted in the field of their trading. However, it should be remembered that being a Polish tax resident, a taxpayer has an unlimited tax liability. That is why entrepreneurs who want to conduct business based on cryptocurrencies are changing their place of residence, the centre of economic and life interests.
There are many opportunities to run a business under conditions that are more favorable than the Polish system. It is worth paying attention primarily to those legal systems that offer the chance to conduct business on favorable terms. For example, the advantage is the lack of the need to lead financial reporting in companies incorporated in some countries, as well as numerous legal and tax facilities, which are already provided by, e.g. the Maltese legislation (a favorable tax system that meets cryptocurrency investors, no CFC regulations, no negative consequences related to CRS, tax solutions also accepted by the Polish tax authorities). A new and effective solution will be to use, for example, the favorable legal regulations of the Marshall Islands with the simultaneous obtaining of a Maltese residence. An adequately prepared solution is not only practical but also compliant with applicable laws. There are also solutions not based at all on the change of residence and, as a result, a significant part of one’s own life, but connecting the Polish legal system with foreign ones, including Maltese.
What’s more, it is not just the business that faces problems related to the settlement of state debts. Many individuals, who deal with cryptocurrencies as a hobby, also hover on the edge of the risk associated with the consequences of personal income tax and even PCC. Therefore, it is worth considering changing the place of tax residence not only in the context of your business but also in your private life. bitcoin-the-most-used-currency is best by which one can do any type of transaction for bitcoin.
For people who, however, do not decide on international tax solutions regarding the settlement of cryptocurrencies, we have prepared an offer based on Polish tax law. Concerning the virtual currency, Skarbiec Law Firm offers, among others:
- Consulting in the field of the emergence of a tax obligation in C2C, B2C, B2B transactions.
- Determining the tax consequences of transactions.
- Choosing solutions that will allow for tax savings.
Tax consultancy and planning: (mining, trading, brokerage, arbitration, currency exchange, stock exchange); current tax settlements (tax returns); training.
Revenues from the exchange of cryptocurrency for currency (domestic or foreign) have been included in the source of income, which are property rights referred to in Art 18 of the Personal Income Tax Act (PIT). They meet the definition of these rights because they are closely related to the economic interest of the rights holder, they can be traded, have a specific property value. According to the fiscal approach, both when selling cryptocurrency and converting it into another e-currency, the tax should be paid, applying to the tax scale (18% and 32%) respectively, or – in the case of entrepreneurs – by choosing the flat tax rate (19 %). The flat tax applies to both natural persons (entrepreneurs) and legal persons. The taxpayer must have the right to demonstrate the costs of obtaining it related to the achieved income.