Bitcoin Forum

If I make money on crypto currencies. How do I avoid as much tax as possible?

Bitcoin is a currency, not some solution to avoid paying taxes. The moment when people start using Bitcoin or any other

Crypto currency as a method to avoid paying taxes, then the government will step in and ban it. I would much rather pay the

taxes and be done with it, than sleeping with open eyes, waiting for the Police to raid my house in the middle of the night.

That is no way to live your life... rather pay those taxes.  ;)

I agreed that avoiding tax is not cool. Since you have made some money with crypto, why not pay some tax to your government. Bring some positive sides of crypto.

Simple
1. Move to a country that has 0 taxes or lower taxes on gains made from crypto trading.
2. Sell your coins for cash directly in person, then stash the bills under the mattress.
3. Hire a pretty good lawyer specialized in this....

Depending on which country you live in you might get away with the second option...or end up in jail.

It would also be nice if you would tell us where you're from...
Since it's one thing if you live in the US or Moldova.

Depend on your government policy.

Luckily my government still not legalize bitcoin yet so I can still earn bitcoin without paying any tax.
For who already legalized by government, there is no other way since when people not paying the bitcoin tax, they are against the law.

It's fair, IMO

First of all why do we think in negative directions and why we need to save our money by violating the government laws.  Government has made the rules for the benefit of the community and country and we should follow it.
If you make money and your government has certain tax slabs you should pay it , rather than to avoid them.

I’m not familiar with tax laws outside of the United States, but in the US, if you hold your investment for over a year, you will pay long term capital gains rather than short term. This means your taxes will probably be lower if you hold for over a year. Day trading is going to be all short term capital gains and a paperwork headache. I’ve decided to do fewer trades than I did in the past for this reason.

The most important thing about crypto currencies what we can all do is to keep it legal.
There is already enough bad publicity in the media, I don't think the average user should start doing things on the boarder of legality with it.

The way how bitcoins are taxed differ in many countries. If it's not really clear, ask a local tax consultant.

Does your country have tax law/regulation for cryptocurrency? if your country don't have, you don't have to worry about that until they announce that they will. If yes, and you don't want your cryptocurrency gains to be taxed, there are few ways to avoid being taxed but I think it will give you some difficulties. You can look for a direct buyer of your cryptocurrencies peer to peer trade, there are risk of doing this so you still need and pay an escrow to avoid being scammed. Another way is transfer to a country that has no regulation about cryptocurrency and use their local exchange to convert it to fiat. But it is not advisable to do this, just pay your tax if needed.

To do this, try not to use the exchangers exchanged by the state for buying and selling - they are taxed. Use private exchangers, limited liability.

I think every country has tax laws on the certain amount earned by the individuals but the taxable amount and actual amount of taxes varies. People trying to find ways to avoid taxes make government make more strict rules. Whether you earn money from day trading or any other method, the amount which you will withdraw in local fiat will be taxable.




How good the world would become if everyone pay their taxes honestly but unfortunatly we always look for things which are benefit to ourself and not care about the others.

If you are not making huge amount than you can sell your crypto for some local guy so that your government will have no record of your btc transaction and you are not liable for tax. But if you are making good amount of money than its better to pay tax and remain safe from any legal trouble in future.

I will happily pay taxes if our government will ever take it by opening doors to legal local bitcoin trading platform.  :(

Buy stuff with bitcoin if you don't have to pay tax for bitcoin transactions(not sure in which countries you have to pay tax for this, do research for your country)
When exchanging bitcoins to your local currency I will suggest you to pay tax, you will get into trouble if you don't pay it. Don't act like child.

Right now Bitcoin doesn't come under any currency or it cannot be controlled by any Authority or government in any country because it has not been made legal in many countries and that's the reason it is decentralized. But if you are holding the bitcoins in the form of assets for long-term investing or if you are trading the bitcoins for short-term profits then you are getting the capital gains which indirectly means it is the source of income for you and you have to pay a certain amount of tax on the capital gains according to your normal tax slab rate in your country.

If you are from Indian Country then you can make a note of this  TWO ARTICLE LINKED BELOW, where everything is clearly explained in detail.


http://www.businesstoday.in/money/tax/bitcoin-gains-tax-cryptocurrency-income-from-other-sources-capital-gains-short-term-gains-income-tax-returns/story/263434.html

https://timesofindia.indiatimes.com/business/india-business/bitcoin-sale-profit-is-taxable-capital-gains-for-investor/articleshow/58691027.cms

Bitcoin currently is taxed only by the South Korean govt. at a rate of around 23%. But tax can be collected merely on amount which you withdraw in exchanges. So the simple rule to save tax on all your crypto earnings is to store the bitcoins in a private key wallet where you don't need to do any KYC compliance. So you are anonymous just with your wallet address. But the problem is that you won't be able to get a fiat conversion of your bitcoins until you bring them to exchanges.

You might still have to pay tax but this is one method to alleviate |

Setup self-directed Bitcoin IRA
setup LLC
setup bank account with said LLC
buy bitcoin
!HODL!

Never convert to fiat not so tax events triggered  ;D. Just kidding, move to the countries with lax regulations on crypto is the best solution.

If your living in your own country and badly need tax to survive or not run by corrupt officials then don’t do it “pay your taxes” because this is morally wrong in the eyes of anyone even our co-bitcoiners if you don’t. But if the opposite of all what I mention is the kind of government your in then use any means to avoid taxing through anonymity and mixing addresses and using deceased identity. This is an option only if your public officials use your taxes for self interest.

Such countries do not exist. All countries of the world take taxes. You can choose to live in country with a low level of taxation. But getting citizenship is always a problem. There's only one way not to pay taxes. It is collect coins and wait when it will be possible to use them as currency. Any exchange of cryptocurrency for Fiat money is tracked by the banks. You will be required to pay the tax.

You can actually avoid tax when it comes to your earning here on cryptocurrency world since its an anonymous thing which tracing out earnings on each individual is not possible and this is one of the reason why government do hate it soo much but these kind of mindset isnt really tolerable on avoiding taxes because if we do think on carefully on whats the actual purpose of tax on our country then we would really able to realize that it is really still an obligation for us to pay taxes.

You have no idea! There's a number of countries that consider cryptocurrency investment to be tax free. The fact that they are taking taxes doesn't mean some assets can be exempt. For example you are obliged to pay taxes when someone gives you a house, right? In such case you need to hire someone to estimate the value of the house and fill in a form. It's completely different if the house belonged to your parents who died and left it to you. In such case you don't owe the country anything.
Here's a list of crypto friendly countries: https://coinsutra.com/tax-free-bitcoin-countries/

enjoy your life while you can, don't do unnecessary things like this. If your government wants to tax your income from crypto currency just pay it or else you'll get imprison though there are legal things that could possibly lower the tax you will pay on earnings through cryptovurrencies, this is known as tax avoidance which i can't tell you since there are different laws in every country.
some says here to move country ? WRONG. if you are a citizen of a country that has a tax regulation on cryptocurrency whether you earn it inside or outside the country they still taxable.

Only solution to avoid tax on bitcoin is to not exchange or convert it into your country's currency and use it as such . As the bitcoin transactions are not traceable so government can't find anything about bitcoins. And if you do want to convert then my friend you don't just have to but you should pay tax as it is a source of income for you and paying tax is important and even a citizen's duty. You should not run from that.

I think it is impossible to tax-free, as long as the banks involved. Unless you are using cash, or other cryptocurrencies to trade,  otherwise there is always a way to tax units found.
Although seemingly not taxable States, but in fact, if you want to tax units, there will be a variety of explanations. For example, in our country, the ordinances that currently make tax returns on Bitcoin transactions are sales tax and one-time transaction tax.

I'm not advocating that people avoided paying taxes. They are necessary for the functioning of the state. But the control over their spending should be. We ourselves are to blame for allowing the elections to defeat those who do not trust. The task of man to think how to earn more money. They should be enough for your life and payment of taxes.

maybe its depend in which country your are now. you ask on how to avoid taxes?, will for me thats not good idea.
you earn money from crypto so you pay tax on it if dont want to get punished by your government.

If you are from a country where cryptocurrency is not yet legalized and your government has no rules about it then you have the option to not pay taxes. I am from a country wherein cryptocurrency is openly used but our government didn't give any guidelines yet as to how it should be tax so I am not paying taxes yet. In case there would be regulations about it then I should just do my obligations because I don't want to be penalized. If you are from a place where the government has a regulation to pay your taxes related to crypto then you should just follow it because there is a risk that they would catch you and you will pay more for penalties and worse is you will end up in a jail.

On top of any crypto-specific guidance given by tax authorities i would recommend having a look at the general tax regime and legislation. How does it apply to capital gains of assets? Do you have to pay tax on unrealized gains on foreign currencies? Even if no specific rule has been widely distributed concerning bitcoin or crypto-assets in general any gains may still be captured by prevailing tax laws, and you do no want to put yourself in a position where a tax authority comes calling for a large bill you were not expecting. Remember everything on the block chain is public information, if they know your wallet address they know every transaction you have made/received.

You sir.. why you looks like really want to avoid a taxes, actually a taxes is important for the country where we live, and that's for the sake of progress+the welfare of the country as well.
I think being a selfish self is not good as a citizen, if the country has legalized bitcoin.. I think it's better to pay taxes and not avoid it as can as possible.

I see a lot of replies but few answers to your actual question & a lot of blatant misinformation. If you want to cash out a significant amount of money, there are a few countries with no capital gains taxes like Singapore or Malaysia and a few others. Denmark has introduced tax exeption laws for Bitcoin. In Germany if you hold Bitcoin for over a year and sell it, you pay no tax. I recall Slovenia being a Bitcoin-friendly country in tax terms, but don't exactly remember what the exact deal is there. Hope this helps.

The best way to avoid paying the most tax is to hold the crypto for over a year. If you hold for less than a year, this is qualified as a short-term swing or day trade. This qualifies for around a 40% tax rate (or something along those lines). If you hold for greater than a year, this is a long-term investment and is taxed at 10-15%, which is much lower. So my advice is, hold cryptos for over a year to avoid paying the greatest amount of taxes.

Self-directed IRA seems suuuuuuper iffy. You have any support for that being an acceptable position for someone to take without realizing the potential risks of getting audited? To my knowledge, the IRS does not agree with you that Bitcoins can be deposited into an IRA or purchased with an IRA. Not saying its disallowed, but if so provide proof please.

LLC = make sure not to use this model if you plan on mining. S-corp. allows you to avoid self-employment tax that would be unavoidable for LLC mining business (because mining is a service and partnerships must pay self-employment tax on service income). Also, an S-Corp might be better, if a little bit more complicated. I prefer the S-Corp model but do your own research. S-Corp provides the main benefit of the LLC in that you're entitled to flow-through profits and losses.

For a better idea of the issues, talk to a lawyer who specializes in the field. Otherwise, pay your tax. You don't want to be wrong on this one because the penalties are going to be draconian if you fail to report / underreport and get caught. Playing the audit lottery is unwise.

That is not correct, at the very least the US IRS has already released documents which clearly state that mining and trading BTC are taxable actions, the former incurring income tax and the latter incurring capital gains tax.

This is true for the most part. Capital gains is normally 20% (although it can scale down based on your personal income levels; certain exceptions may exist). Ordinary income rates are used instead of 40% but the highest ordinary income rate is 37% under the most recent tax bill.

Keep in mind, however, that if you are MINING the coins in a business, you are not entitled to long-term capital gain rates because the mined coins will be treated like inventory and inventory is a special asset class for purposes of US tax law. You can do some fancy footwork to get around this, but it involves multiple related entities and is complicated enough to deserve professional consulting to find the most efficient chain or link of entities.  

Furthermore, if cryptocurrencies (or just Bitcoin) is ever classified formally as a COMMODITY instead of a SECURITY, no coins will be entitled to long-term capital gain treatment because commodities, like inventory, have their own set of weird rules which also disallows capital gain treatment for the purposes of US tax law.

It does not happen. Even in the US you have to pay tax only after the exchange the bitcoin for Fiat. In order not to pay taxes it is enough that you are not using exchange. Perhaps in the future it will be possible to buy and sell goods with bitcoins. This saves us from having to pay taxes. To ban such deals will be difficult. Therefore, the government will be forced to accept the bitcoin currency.

Please, no one in the US listen to this person. This is a blatant falsehood. People who mine cryptos realize a taxable event the moment a coin is mined (due to accounting difficulties, it is likely administratively acceptable to do this every 1 coin as opposed to for every miniscule block reward split among members in a pool). Even if the coin is not sold for fiat, IT IS TAXABLE.

Furthermore, exchanging the coin for something else of value (in whole or in part) is going to create a taxable event where you must calculate your basis and recognize the appropriate amount of gain at the time of the transaction, if this gain is on a capital asset and has been held for more than a year (such as Bitcoins held for personal investment by an individual), it will be entitled to favorable capital gains treatment. If, however, the coins are held in a pool by a partnership (LLCs included unless they make the check-the-box election) or S-Corp, the taxes must be paid on gain as of the last day of the partnership's taxable year. This is true EVEN IF the coins ARE NOT SOLD FOR FIAT OR OTHERWISE EXCHANGED FOR ANYTHING.

To the person I quoted, please don't give people bad advice. It's okay to say you don't know or you're not sure if you're right. But don't claim to be an expert on things you know nothing about because people might trust you, make a bad tax decision, and then blame cryptos on the whole for their problems. 

I don't know why do people bother themselves on thinking that cryptocurrencies is the best way to avoid taxes.Just like being said this is not being created for solely on avoiding taxes but somehow it do have the features which you can actually do this thing but for a sensible citizen of a certain place you would really need to pay taxes.If you would really avoid and then suddenly being caught by them then fore sure you would end up behind bars.

Government has enslaved people to continually work for them.The elites who
hijack political powers with their influence are the ones imposing these taxes.
This is the major reason decentralized block-chain technology came into fore
to eliminate the injustice of banks,government laws and restrictions observed
globally.If the tax is fair, well and good.But if very heavy and unfair, i simply
relocate to elsewhere for a better deal.

Taxation is everywhere which it will normally be asked by any government but the thing here is that on how they do gonna handle it if it would be following the right process or not.Abuse of this opportunity because of their power is common which they really the advantage on making money out of those tax this is why decentralization makes a buzz as of now where people do see the chance on changing something when it comes to tax.

Last time I checked being against taxes wasn't a crime. It's my opinion that the system is flawed and taxes are nothing but an abuse of power. I'd like to see them put me in jail for being against the slavery they were so much against in their official statements, yet we're all living in a world of modern slavery.

Pay your taxes, social security, even if it means you won't be able to put food on your table. If not we'll put you in jail and supply the food clothes and clean sheets for you at the expense of other taxpayers (slaves). What kind of a system is this? :D

What you say it's true. I think it's very interesting that when investing, we must take the risk by ourselves, no one is behind us, if we buy some BTCs or AltCoins and tomorrow their prices fall and we lose all our money, it's all over... But if we make profit, then we must share a piece of it with the government. Total advantage for only one side, right?  ;)

Why isn't the government solidary in case of loss too?

And even in Crypto world, there are enthusiasts that feel offended if you put yourself against taxation.

Bitcoin is taxable but when the government make it legal in our country want or not we need to pay tax over our income in crypto.We cannot avoid it once it was implement ,following our rules and make it clear to us that we do not  need to avoid that .Its such a crimial.action once you avoid that.

Your point is valid. If you make money, pay tax to the government and if you loose, the loss is yours. This is the basic taxation framework for almost every countries and pretty much one-sided. So then why are you asking your government to build roads or sanitation system or other infrastructural development? Government is building such facilities for common people like you and I to use for free of cost. Isn't it an one-sided facility for us? Instead, they can build roads and sanitation system and ask money everytime you use those facilities.

Take an example of the Police force that government has built for you and I. So if a burglary happens in your house and you call the police to investigate. Imagine that police is asking for service fees from you to investigate and giving you receipt for the same. Will you be paying that? You expect that police will register your complaint and investigate the matter for you without charging any fees. So that's an never ending debate and every party has their own flaws in the system. Because nothing can be flawless in the world. I am sure a lot of government are corrupted and chargind unjust to their citizens, but we all have to live within a framework and a system. If you are out of the system, you are an outlaw. 

I support paying taxes to the government. For investments of any sort, there is a provision called "capital gain taxes". Where your net gain is taken under consideration after deducting all your losses. Let me give you an hypothetical example on it,

1st January 2018: Bought 1 bitcoin at $10,000/btc
3rd March 2018: Sold 0.5 bitcoin at $9,500/btc
5th June 2018: Sold 0.5 bitcoin at $12,500/btc

So in this trade, you first sold a percentage of your bitcoin holding at loss and you made profit in the 2nd time. Look below to know how to calculate the capital gains here,

1st January 2018: Bought 1 bitcoin at $10,000/btc
3rd March 2018: Sold 0.5 bitcoin at $9,500/btc (received $4,750)
5th June 2018: Sold 0.5 bitcoin at $12,500/btc (received $6,250)

So total amount received is, ($4,750 + $6,250) = $11,000
Initial investment: $10,000
Net gain: $1,000

So you capital gain will be $1,000 and you have to pay taxes on it. There are other conditions like the time of holdings etc, but that depends on your local law, so I won't discuss about those. But that's a basic idea of how the capital gain tax works and how you calculate your capital gains. So you are only paying taxes on your net gain. If you are making losses, that loss will be deducted from your profits. Government is not our enemy, we just need to follow certain rules. I hope this reply will help to clear your mind.

I think you should pay the required taxes to the authorities or else it might create a problem for you in the future. If there is no tax provision at the moment for cryptos in your country, then still be ready to pay the tax as the authorities can reach to you at anytime in the future. If government authorities caught you then you might have to pay heavy penalties for tax evasion. I would suggest you to check the local law related the cryptocurrencies in your country, be a responsible citizen and follow the same.

Thanks for your reply.

I would like to say I'm not fully against taxes, I'm not at anarcho-capitalist side, as we need a government managing the basics we need in a society to keep it organized and to guarantee the order. The infrastructure and security sectors are very important and necessary*, I agree paying taxes (as we already pay in our countries) destinated to these areas. But one of the main problems is that we don't even know for what we are paying taxes.

We don't know if determined tax is going to welfare programs, if it's going to sustain the artistic's class (some kind of monetary incentive from the government for 'cultural projects'), if it's going to politic's and lackey's pockets, if it's going to finance foreigner dictatorships, if it's going to education, health, security, etc...

So I'm not paying for a service that I use, I'm just financing political campaigns via taxes (as they buy votes this way, via welfare programs and theft). Also, there are several bureaucratic public jobs and services that are totally worthless, they shouldn't even exist.

And then, even taking so much money from citizens via several different taxes and abusive tax burden, why do they need Crypto-Currency profits? Isn't the country already 'working' fine without this Crypto income? Let the Crypto investors boost the local economy by investing on it by themselves, by opening businesses, by increasing their purchasing power, by learning how to live and spend their money by themselves without the state machine telling them what to do, how to do.

Sometimes, depending who is on the government, yes, it's our enemy, and if their rules are unfair they shouldn't be followed. Maybe in evolded countries things work better, but it's not everyone's reality, the taxation abuse is heavy in many places. The balance must be respected to keep the harmony flowing through the men's hearts.

* The quality of these services are also very low. Broken roads and low work's conditions for security forces.

It all depends on what country you live in and how you set up your tax affairs in general, remember tax avoidance is legal, tax evasion is illegal. So plan carefully and seek professional advice.

So you think others should pay your bills? How do think the roads get repaired? You  leaching off people. If you think you have a better idea about how to run a society then please tell. But make no mistake, you are not being a hero, you are being a deadbeat who would rather stick his neighbors with his share of the bill.

If in your country there is no a special law for taxation of crypto profit then you have nothing to worry about. In the case if such law on the last stage of acceptance I thin you need to move your crypto earnings to another country where there is no crypto regulation laws yet. Just I do not know exactly how to do that, I am in the mood to pay the necessary percent to the government if such earnings will be count as self take business.

maybe the tax you're pointing at is either the miner's fee or the processing fee when you make a withdrawal in your local bank like service charge of the bank. There is no way to avoid both of these, because they're the foundation to the succession of your transaction in the blockchain. It is better to pay instead of evading it and we should all feel lucky for now that government isn't charging us a tax yet in cryptos. If they put a tax on it soon, just pay for it because it can end in a wrong end

It is easy to avoid tax on cryptocurrencies, don't declare your income, don't tell anybody that you are earning from it, make some tips to other people but after avoiding it when it is required by your government then be ready as well for the consequence it will have, you may not be imprisoned but your name is already blacklisted in the tax gov and it will be hard for you to get tax clearance as one of the requirements for loan.

Isn't that exactly what they are doing? To connect to a water pipe I have to pay. I have to buy a water meter myself and pay for it's legalization. I have to pay for maintenance of the pipes even if I'm not using any water, and of course I have to pay for the water that I actually use. On top of that the local water and sewage plants are built and maintained mostly from local taxes. The taxes I as a landowner pay anyway. The taxes from your income will never be turned into the things you need. They are going to finance the military, maintain government buildings, bail out banks and social care services that are always losing money...


I'd gladly pay for the services that benefit us all like the police, fire, healthcare. These could be easily maintained through a head tax. A certain sum equal for every citizen that would support the most basic and important institutions in the country. One tax instead of the numerous ones we're paying right now.
Also, income tax is unjust. It benefits the lazy ones as the more you work the more you have to pay.


If you like being treated like a slave, so be it.

When there is law in your country requiring you to pay tax in every bitcoin transaction then you must follow it and be a law abiding citizen. Authorities especially in US has a technology that can track and report bitcoin transactions. Bitcoin is said to have a permanent searchable record of transactions that can be use by the tax authorities to track someone who avoid paying his/her taxes.

Please, be rational and change your thinking faculty about tax payment. Be of good sample to the world that Bitcoiners are law abiding. Primarily, our system at the face of it seems avoiding payment of taxes, since we are the sole controller of our encrypted wallets, left alone mild ones being charged at exchanges. But with deep sense of humour, you shall pay tax/tariff on goods and services purchased with money gained from Bitcoin. ;D. hahaha.. Is this not sensible enough? So, you can not shun tax payment wholesomely in Crypto and try not to be A tax evader, if you are but a good Bitcoiner with respectable dignity.

I find it hard to see through your post to see if you're being sarcastic or not, especially with that emote. There's nothing good or bad in paying taxes. I mean a law abiding person could be considered as good only if the law established by our governments was good. But is it? Is the tax law good? Is it just? Those are the questions each of us should answer in their own conscience. I think that I am a good person, but I don't see the law as something good. More like the necessary evil.

Well, paying tax is not so much in pain so we don't have to worry things about paying, it won't make you suffer and become poor, so it is better to help rather than having a poor country and banning bitcoin in your place. I would rather help my country as well rather than seeing those in need suffer without doing something.

Firstly, tax imposition on cryptocurrencies primarily depend on the laws you have in your respective country. All countries have their own stand against the regulation and tax imposition on cryptocurrencies; your obligation now is to be responsible and diligent enough to at least check if your country approves on cryptocurrencies. But in general, I believe that cryptocurrencies in general aren't taxable due to their decentralized nature which makes them the perfect medium for transactions.


Yes, it really depends on the country's law regarding cryptocurrencies. Just to add, if cryptocurrencies would be taxable then expect prices to decrease on a certain level. The prices also may be controlled in some-point, which makes it no different from other investment options.

I'd not try to evade tax, after all, crypto is like other things such as stocks, if I gained I'd pay tax, just as other things.

It's easy, you avoid tax on crypto exactly the same way you avoid tax on your other sources of income.

Last time I've paid income tax was in 1997. I'm making more money now, that made me smarter about my tax avoidance strategies.

Exactly when you earn then you have to pay tax be it any country unless the country has a tax free system. I am really clueless why would OP like to evade a tax from the earning which is provided by their government. If that is the case why would govt allow such things to happen they can discontinue it.

at last someone has spoken about being a law abiding citizen!
seriously people we should know how really tax works, even if our government is very corrupt don't make yourselves in a position that will threaten your freedom, what your laws says must be followed regardless how hard it is and besides there is not trading in jail.

Paying tax is everyone's national and social obligation, I don't think it would be good if you skip paying it and probably you're putting yourself on harm. If your government impose tax on it then better to pay it forward. Here in our country there's no tax implications on bitcoin - none as of the moment. But at the time we convert it to bitcoin and usenit for purchasing then that's yhe time we are paying our tax. However if the government impose tax on btc then I'll do my part.

Legally the only way you can avoid paying taxes (that are above what you are supposed to pay) is by taking/recording all your transactions. And by taking down I mean recording it and providing supporting evidence. Separate everything on what is income from what is capital gains. As when you get a random audit from the IRS you can provide them supporting evidence that you are paying your taxes right. Also everytime you are receiving Bitcoin you must record it to its U.S. Dollar/ Fiat Currency equivalent during the time you have received it.

The only legitimate way I can think of is for you to declare it as expenditures thereby lessening tax obligations. You can do so by gathering all receipts possible, and declare it as something utilized for your business, profession or occupation. Otherwise, you will be held liable for tax evasion which is a heavier offense than that of tax deduction.

Nonetheless, remember that in a system like that of the US, you cannot just do away with your tax obligations. Hence, I suggest you just do what you are ought to do. Always have a backup for them to be able to assess your tax based on the value of your crypto when you realized the same as a profit. It is important for you to have supporting documents to attest to the authenticity of your tax declaration.

It's not about being slave. It's about being within the system and that is in existence and still being profitable. If I try to be rebellious, the government will simply put me behind the bars. It's too hard for an individual to go against government. Instead it is always better to find a solution. I pay taxes from my profits and keep the rest of it. Both are happy. That should be the conclusion. Government is certainly not taking up 100% of my profits as taxes. It will be a certain percentage and I get to keep the maximum portion of it. That's it! The way you are pointing towards things, it will make 100% of the world population looks like slaves only. 

Easy, Just don't pay.  Of course you may go to jail and owe huge amounts of money. So it is a very stupid idea.

First, it is a crime to avoid due tax.

For crypto tax paying, you should not conceive the idea of paying your tax if your country levies on it. If you are caught, you might find yourself in the dark room because it is a crime to avoid carrying out your civil responsibility to your country. By the way, the tax money is "suppose" to be used for development , infrastructure and provision of amenities .

Here is a more nuanced answer. While taxes are as sure as death you can lower your tax burden by:

1. Claiming any losses you have to offset gains.

2. Taking full advantage of other offsets like charitable gifts.

4. Looking at tax income brackets and keeping yourself from making enough to get bumped up to a higher bracket. In 2018 a critical level will  be $316,000. Those who make $315K will pay a lot less than those who make $317K

3. Moving to a jurisdiction with lower taxes. I am looking into this since finding out that 9 U.S. states have no capitol gains tax. Of course you still owe the fed. Its' not very practical, but you could also move to Dubai. 

Why do you even consider avoiding of paying taxes out of your bitcoin earnings? If the government imposes a tax regulation on btc then better to take the responsibility of paying it. Tax is every citizen's obligation so if you're thinking of avoiding it be ready of the consequences of it.

There are lot of countries that Bitcoin is not legal but not ban therefore if you have lot of money for investments just go to the countries and join the trade in that place but if you're country in which you are living has declared Bitcoin as legal for investment then it was regulated that everyone will oblige to pay Bitcoin taxes per regulation policy therefore i'm afraid there is no way for you to avoid this obligation in which it might put you in jail due to tax evasion.

Humans living in the present can not be 100% avoid taxes. Especially the consumption tax or Value Added Tax (VAT) is most difficult to avoid because everyone uses the manufactured goods from a piece of cloth used in which there is VAT. Extreme ways to avoid VAT or consumption tax is not to buy or consumption of goods that have tax. Eating and drinking foods and beverages excluding taxable goods, not VAT objects and not local tax objects

Bitcoin and basically any other crypto currency requires people to pay tax regardless of the legal status in a specific country. It's not that you can hop to an other country to avoid paying tax.

That only works if the country in question handles a general no tax policy concerning capital gains and whatnot. People forget that crypto value adds up to your fiat wealth, which you need to declare in all honesty.

Without crypto even being explicitly mentioned, it is part of your total wealth, and you need to pay capital gain tax as well. The only thing a legal status can do is change the category crypto fits in.

It's basically what happened in Israel recently. Crypto has been declared a property, which moves Bitcoin into that tax category instead of a more general category that is suitable for various financial products and such.

Never try to dodge federal taxes unless you feel like money is worth more then your freedom (it's not).

Pay the taxes so you can live a stress free life.

No reason being audited 10 years later, when you have a house/car/family, then having it all seized.

Stay clean and fly straight, always.

Do not we have to have fixed income to pay taxes? The crypto money market does not always give us a chance to earn money, and there are times when we have lost money. The State should help us when we have lost money :)

What if the both aren't happy, because I'm not happy sharing half of my profits with a leech that isn't helping me earn it in any way.
Following your logic if a mosquito sits on your hand you should let it drink. It's not hurting you much, he's not taking 100%, right? It's better solution than having to wave your hand around trying to make it go away. Once it's full it will fly away on its own, never to bother you again.

Well who is happy in tax? Well, I thought no one is happy either. We are all not happy it is just that we don't have any choice but it is okay because it is for the security of our government. Let us be honest, although there are many corrupt politicians there are still something that made us proud to become part of that certain country.

Why do some people here think that the government is a leech trying to sip a part of your money? To my understanding no one is exempted from paying taxes and all of the citizens whether you are a government official or a normal citizen or even a juridical person you must pay your taxes.

Or maybe I am missing out something?
That the concept of Anonymous Currency in Bitcoin make us think that we are exempted or it must be used to take advantage of the government. Well if that is the case then this might be the root of the problem where a lot of us think that earning Bitcoin make us exempted from paying our taxes.

Some people might see tax as a waste of money because of corrupt politicians but I'm proud to say that I am a product of a tax, and because of that I got my degree. Yes, we pay too much on tax but try to think the good thing that can happen because of that. Though currently here in my place I'm not paying any taxes but I think it will happen soon and no one can avoid that.

If cryptocurrency is legalized then we are entitle to pay for taxes. Why do we have to avoid taxes? Otherwise the government might seriously ban cryptocurrency then. As of the moment, in my country taxes are not imposed yet. I can’t say bitcoin or other cryptocurrency is Legal already here but so far i did not heard any violent reaction from the government in my country yet, just not yet.

You think that the people are taking advantage of the government by not paying taxes. I think that the government is taking advantage of the people by making them pay high taxes, too high to be called just and fair. If Someone calls himself your master, tells you to share half of your money with him and threatens to chain you up if you don't, it's rather unfair. If you hide some of your money so that the master doesn't get what he demands it's you that is taking advantage of him. Is that it? :P

Actually , you dont. You cannot escape government and their rules. The best you can do is not declare your profit to avoid getting taxed but i think you know the consequences. Taxes went to different government projects so for me thats okay. On the other hand, some government officials takes an advantage to this system but this will not the reason to blame them all.

only people who have no great responsibility ,, if escaped from reality, avoid taxes is the wrong person.
But right now, we will not pay taxes, because the government has not cooperated with bitcoin.
crypto, is digital money ,, it makes sense if there should be taxes.

Exactly. We citizens are powerless when governments try to interfere anything and all we could do is to follow. But I think we can still demand fair taxing system in case they became unreasonable on their decisions.

Partly yes because citizens in a certain countries has an obligation to pay taxes from earning to the government for the community and for us to receive benefits especially when we got old. But what if you belong im a country where government doesn't really care for the welfare of their countrymen? And the taxes that they collected from the people who strive to work hard to feed his/her family goes directly to their own pocket? Is it really worth it to be honest in paying taxes by declaring all you assets?

Lol, the tax system has been unfair for decades, and you think we have even a slight chance of changing that? If there is one thing that we have seen become reality, then it's the fact that the tax rates have only increased.

In no shape or form will people be able to demand anything from the government. Instead, it's the government that demands us to abide by all their ridiculous tax rates, which should be clear by now.

The only thing we are good for, is being used as cash cow for the government, and in case we're trying to avoid being a cash cow, the government will come after you and milk the money out of you, that's how it goes.

Yes, I admit that it is really an unfair system but what can we do about it? There is nothing wrong about tax, those government officials imposing tax system which creates more burden to people are the ones really making us more poor and they are all benefiting on it which makes us sick.

If you want to play fair just pay the tax , even if you pay tax probably you will be still in profit. But if you really don't wanna pay tax , try sell bitcoin on street. Find on your local forum someone who want to buy bitcoin and you meet him in coffee shop , he give you money and you send him bitcoin. That is how I did once.

You can start speaking against it. It's already a beginning.

In my country things reached too far until people started seeing how harmful is to be a pacific sheep being guided by wolves directly to the slaughtery. People accepted more and more taxes without resistance and without quality services being offered for too long. And now it's ridiculous to see a country with one of the biggest tax burden of the world broken!

Once people acquire conscience about what is happening on their own countries and start speaking out about it, things will start improving.

The question is if they do have the conscience?If they do have that thing then lucky for a certain country because possibilities of development or changes is still there but how about countries just like mine which it is being known to be one of the most corrupt countries even up to this date?I don't see any hope on such changes on my lifetime.This is why sometimes I do think paying up taxes is really useless at all.

How could someone powerless demand to the government when it comes to taxation? Just pay off your taxes and you will be flee from those interference.
Tax is the blood of the government and every single citizen that has a source of living needs to pay off unless he's exempted.
Just pay taxes and declare how much you've earned so you won't think crazily on how to avoid it.

It's indeed worthless and that is the conscience people here are acquiring. Now they are seeing the abuse the local government is committing since a long time ago and how useless are the taxes as there aren't decent services in return and all we see is mockery and corruption. It's a slow process, but at least it's happening.

I'm not saying people want to live in an anarchy, without paying anything, but they want to pay less, because as it is now it's abusive and when we talk about Crypto-Currency it makes no sense to pay taxes for this... On the other hand, there are always these people who just want to frighten those who are unsatisfied and seeking for changes, saying: Nothing can be done, you will be arrested, it won't end good for you...

But no one is saying about violate the rules, but to change them to make it fair for all parts.

About corrupt countries, it's indeed very frustrating to not be in sintony with our countrymen. Sometimes seems we are swimming against the tide and that nothing will happen as most people are alienated and following previous patterns that just make the system's maintenance. But it's important to always keep some hope inside our hearts, because without hope we become bitter and it just bring negative effects over us along the time...

It would be better for you not to avoid paying tax if you are making money out bitcoin because it will cause much trouble. Tax is required and its in the law no matter how we say that bitcoin is decentralize and it was created because of the financial issues we are facing still we have to obey the law.

Sounds like you are belong in a country right now where the government was legalized the cryptocurrency to circulate it in your place. That is why you do not have a choice to keep yourself away from that system and so you should obey the rules, and I think you should be thankful because your country legalize Cryptos this will helps you and the others for your legal protection purposes unlike the others which never have an experience because their government banned the cryptocurrency.

If your government did not legalize bitcoin than you're lucky enough because you can earn bitcoin without paying the tax.

But if your government legalize bitcoin already than you must to pay and can't evade. Just take a look on positive side, if government legalize bitcoin, it means that bitcoin's demand increase !

my country is not taxed on crypto money.but I think it will come to tax.then I have to make a lot of money until then..

Crypto is not a currency but i believe and its more of a commodity that needs to be regulated. It sucks when the government will taxed everything but as a citizens we must know our obligations and what is our role in the society. Lets not forget to help our government to grow, because if we hate taxes it can be a hindrance of our crypto growth.

Its always been normal in my mind when it comes for governments involvement when it comes to taxation matters which they do really engage with such thing as long they can able to sip out percentage of the total income of a particular citizen.Its really an obligation for its citizens to pay up taxes and its really a senseless thing to do on avoiding it yet we do all know on how important the role of taxes we do contribute on.

You can gift up to $15,000/year in the US taxfree.

The tax of every country is very important for people's lives to be better and prosperous, because paying taxes is the right and duty of every citizen for the development and growth of the country. but most countries still can not formalize the existence of crypto, so taxation on crypto is not fully regulated by the government. It may be that at this time only certain countries may set tax payment policies for people who use crypto, over time, if all crypto users can use blockchain technology for positive purposes, it is likely that the country will fully control the digital currency and the crypto tax will be set by each country.
if it happens we should not avoid it because the taxes of each country aim for the development of existing infrastructure, we must support the existence of government policy.

We can actually avoid tax easily especially when our country does not regulate tax yet or has imposed tax, we can easily do it actually so nothing to worry about avoiding it unless you are in Korea, Japan, USA where they have strict implementation when it comes to  paying taxes.

One simple way you can reduce your tax liability as much as possible is by declaring income as less as possible. The less amount of income you will declare less will be the tax. You can do this by not bringing in your funds on places where you have complied in with KYC requirements. Moreover what you can do is make most of your expenses payment directly using cryptocurrencies which too will make tax burden less. Rest depends upon the laws prevalent in your area.

A wise decision i guess if their country is not so fund of looking always at your bank account. I would not put my money on any banks if my plan is to pay less taxes because one day they might find out your transaction and will might seize your account or froze it. I'd rather hide my money under my bed(lol) if the government was always watching you.  ;D

Not everywhere cryptocurrency is even recognized enough to be taxed because the government at these countries do not even view it as a verified sense of legal tender.
After they do then they will regulate it and will have its own little box on your annual tax form to fill out the amount that you made using it for the year.
Until that time just enjoy using it not to be a tax evader. ;)

It is not a good idea to avoid paying your taxes if the law says so. You may be able to get away with it for a while but the troubles you'll have to go through if you get caught are just not worth the few dollars that you've stashed. While moving to another country where laws are easier to circumvent compared to where you came from is an option or there are no taxation on bitcoins in that place at all, doing such a move for the sake of avoiding taxes is quite a big price to pay unless you earned billions through your cryptocurrency investments. But by then, you wouldn't actually be in this forum since you can now hire a team of lawyers to do the thinking for you just like what big multinationals do.

For those who are planning to break the law in relation to cryptocurrencies, this story from Time magazine re Jason Klein may be a good read - http://time.com/5161663/bitcoin-sting-jason-klein-crypto-irs-money-transmitter/.

Op, the only way in which you can avoid paying tax from your bitcoin and crypto currency earning is for to relocate from your current country to country where taxes are not paid on crypto currency related activities such as Nigeria. 

I would have given you merit if I have some left. :)


The idea is very much precise.

I do agree that is will be depending on the country you are staying and if it will be upholding the taxes for bitcoins. Government will find ways to deduct fees and taxes through technology too. Like for an instance, here in our country, wallets are deducting fees in transacting through remittances.

Upfront transactions, or user to user is quite helpful too.
No fees and you can sell them freely.

How do you know that crypto doesn't get taxed in Nigeria? Even if it was like that, with more and more regulations being enforced globally, things might change rapidly, especially so when it concerns taxes on cryptos. And then it also depends on what category they place crypto in. In Japan for example, you'll end up paying 55% in tax when it comes to amounts over $350k in their own fiat currency. In the US there are states where the property tax rates are insanely low, but on top of that you will also have to pay state tax, welfare tax, etc. If you calculate all these different tax levels, you'll come to a tax figure close to 40-50% in certain states. Crypto is a cash cow for the government, that's a fact.

You are right if you do not want to pay the tax fee you can ask for your acquaintance that close to you to buy or to exchange your bitcoin into cash freely. You can't avoid paying taxes especially when you cash out you bitcoin into cash you must have to pay in remittance that where you get your money. Nobody exempted when it comes paying taxes because when getting money you need to pay for them.

I don't think it's a good idea for you to keep hiding from your taxes due to your crypto. Since you're asking this, I am assuming that your country established regulations about cryptocurrency to which is why it is being taxed. With that being said, you have a responsibility to fulfill. Avoiding your tax would just lead to no good. Somehow and in some way, the government would find out and would even burden you with even more fees or penalties to pay. You're lucky that crypto is not banned in your country, so be a good citizen and do what you have to do. You wouldn't want to face worse situations just because you're avoiding a law that would actually lead the the betterment of your country.

If you say, a wealthy businessman in Germany who wants to evade taxes, or a smuggler of illegal drugs, or a brutal ruler, then the means used to evade taxes and conceal the origin of money are very similar.

There is only one way to avoid paying taxes. You need to abandon the use of Fiat. I don't know if you're ready for this. Doubt. There is a way to change bitcoins to cash without using a Bank account. But this method contains great risks. I'm not sure you're not going to be a fraud victim. Sometimes robbers for that kind of money can even kill.

That is one of the option is to create a setup or register a company outside where their is not taxation. Another thing is that you can split the investment between your family members  or whose income is very less so that the tax burden would reduce drastically. Total avoidance of tax could bring you in a legal trouble.

You're one of the first people I've heard agree with me about this! My thoughts are slightly different in that I think cryptos can be broken up into three classes: (1) currencies (bitcoin; monero; zcash; ltc; ripple; other 'store of value' coins); (2) commodities (ETH; some other ones; anything that gets 'consumed' when using the platform; and (3) utility (factom; storaj; espers; etc.; tokens that don't get destroyed and serve some sort of functional purpose but which are built upon a different cryptos platform).

Ideally, in this system, btc and the like would be classified and taxed as foreign currencies, ETH and the like would be taxed as commodities (60/40 rule), and utility tokens would continue to be taxed like property.

Too bad the IRS will never get their shit together enough to figure this out!

Paying taxes is a legal obligation, and you shouldn't avoid it. You are benefiting from various governmental interventions for you to earn crytpo, be it electricity tariffs, super good internet, etc.  So you are benefiting from this, in turn you need to return the favor in taxes for this "peaceful earnings to continue". The only thing I can figure out is how you can stay anonymous if you declaring taxes from crypto. Because most people want to stay anonymous via crypto involvement in the face of the government.

Purchase Cryptocurrency With a Retirement Account
A lot of people understand that retirement accounts are like IRAs and 401Ks or ROTH investment options. They give tax breaks that help people save money for retirement reasons. And, many cryptocurrency investors also think they can avoid paying taxes because their digital currencies are making money through accounts set up for retirement. But this is a process that is not as easy as one may think.

When an American citizen or resident wants to by cryptocurrencies through an IRA, they need to first transfer funds off shore. They also need to setup an LLC that operates in a country with zero taxes. The company that is offshore will need to then open and bank account offshore that works with a digital currency and wallet to complete the transactions on the behalf of the individual.

It sounds complicated and that is because it is, you need to have help from an attorney in the United States and a foreign counterpart in the country that you’ve chose for hosting your IRA. There a lot of legal fees as well that will start to build up fast. And without understanding the way that transactions work internationally, there’s a chance it will not work out. If the person hired to set up the IRA chooses to bail out and run, you can’t really do much about it.

The complex nature of the situation and potential for fraud are only the first of the many problems you’ll have to face. You’ll also have to learn how to take care of and handle your own investment. The IRS will not allow you to borrow money from the account or make a profit from it in any way. It’s just like any other personal investment company would work.

Also, the total contributions that happen on a yearly basis can never exceed $5,500 if you’re less then 50 years old. After that, they cap at $6,500 and that is only the beginning. Even if you make it through the challenges and red tape, there is still a strong chance that you’ll have to pay taxes on any capital gains made.

If You guys live on a democracy... then can select your governants.
Why allow them to add taxes to any income you have?
Do you think govs really do superb good things with the money they collect from your "donations"? Thats up to you.

If you want to avoid paying taxes on crypto, then there are both legal and illegal methods to do that. If you want to go the legal way, then I'd ask you to hire a good tax consultant. If you want to take the illegal way, then you can do that through pre-paid debit cards or cash on mail.

Luckily my government still not apply tax on bitcoin because bitcoin against our law.
I can use bitcoin without pay any tax but I must bear own risk.
For me, applying tax is worth because it can also generate country's income for their own good !

Don't make any money. The best way to avoid taxes is to live dirt poor your entire life. You'll be liv'n the dream in your cardboard box under the highway bridge. No government tyranny now! Just the freedom of all the garbage you can eat.

Why on earth will you think of such a thing that if Bitcoin and altcoins are accepted as a means of exchange for goods and services and equally accepted as taxable income by your government.

I think tax consultants will not be able to avoid you on the taxes that will be given to you. maybe the accountant can do a good calculation and reduce the amounts taxes that may be given to you. but I think avoiding taxes with crytpo is so easy? you know that crypto is decentralized and anonymous. you can hide your income very easily right ?

If Bitcoin and crypto currency in general is taxable income in your country or region and you are finding ways in which you you not pay tax i see you as an enemy of your government and i will not advise you to do such a thing as is contrary to the law of your country. But if you leave in a country like my country where Bitcoin and crypto currency in general is accepted as a means of exchange for goods and services and the our government didn't adopt it then you need not to pay tax and that is what we enjoy here in my country.

It seems like here our country we much enjoy using cryptocurrencies because our government did not take an action on bitcoin to put a tax on it, the good thing is our government recognized bitcoin as a part of a currency where able to have transaction online.
I think the tax that we paid is in the wallet company that we have, through conversion bitcoin to cash we have already deducted by the transaction fee, and then when we cash out our fiat there is transaction fee in remittance to claim our fiat. And that way we could pay tax

If you try to avoid paying taxes to the governments then it will be considered as illegal action so it will be better to pay the necessary taxes.BUt if you are using crypto currency as crypto currency then you no need to pay any taxes but if you cashout that crypto the problem will start.

After the newly written U.S. tax laws recently passed, cryptocurrency investors realized the tax-free exemption filing 1031 for IRS reporting is no longer applicable to their digital asset investments. The law also implies that a lot of people will have to pay taxes on every single transaction they processed.

It depends on how your country's law tax your profits. In some countries, I've read that long term trading or holding will tax you much more so you just need to adjust to that and only do short-term trading to reduce it.

I feel bad for the people who think that not paying taxes is an option. They are going to turn the investment of a lifetime into a jail sentence. It is foolishness.

Minimizing your tax liability through careful planning is always a good idea. Evading taxes, however, it's not.
Failing to pay the required taxes on your Cryptocurrency investments will land you in real hot water with the IRS or any other tax organization.
For peace of mind reach out to cryptocurrency account at HappyTax. They are specially-trained to help you with your tax exposure

not the time we chose not to pay taxes  ;D... now taxes on everything, even what you bought for your money, you have to pay the state, although it did not help you at all.  such a policy.  and the same with the crypto currency, someday we will be charged for each transaction with which the interest on the exchanges is already taken ...

I think if in your country, there are any tax for crypto, you don't have to avoid the tax but you need to pay the tax because this means you are still supporting your country so you can help your country. besides that, you can avoid breaking any law or regulations that need to pay any tax for the citizen of that country. and I think the tax is not too expensive if you compare with your income from the crypto so you could still enjoy your profit and you have your money from crypto.

Sometimes it is currency, and sometimes it is not. But avoiding taxes is a question not related to Bitcoin itself, rather than one made profit from trading. Hire a finance guru for that :)

Why not just comply with the regulations of our country, we are always looking for a best result from our government but we are doing everything just for us to avoid tax, is it fair? I don't think that it would be a good idea too, we should also comply with our obligation for us to have the right to complain when our government are not doing their job too.

First of all in my country bitcoin is still illegal so I don't pay Tex on my profit on bitcoin. ;D

Last month the IRS issued a serious warning through a press release to anyone that does not pay taxes on their cryptocurrency profits. The statement says that “taxpayers could be subject to criminal prosecution…Anyone convicted of tax evasion is subject to a prison term of up to five years and a fine of up to $250,000.”

Unfortunately, few people understand how to account for cryptocurrency gains on their tax returns.

I agree, but wasn't there a tax added to a transaction when you are transacting in a country with bitcoin is legalized?

There are two things to consider: firstly all the essential services that you use come out of the taxes you pay-so morally and ethically you should pay tax.

But if you want to avoid them it will depend on how much you are making and where you live how you do it. For example: it is possible to set up an offshore company with bank account with bearer shares (no names on them) with nominee officers for a couple of thousand dollars the bank will still want to do it's due diligence but it's not a major difficulty to pass. You then need to work out how your going to spend all this money without attracting attention-it's no point putting on your tax return that you are making for example ($50,000 per year) and then drive around in a Rolls Royce or Ferrari! 

Offshore companies have been for decades, and are still used by the rich and by businesses to minimise their tax burden. PM me if you need more info.       

Does it make sense that you are subject to these barbaric threats when you are just protecting yourself from the biggest thief on the planet (ie, the government)? Instead of making me pay tax, these threats once again convince me NOT to pay tax. :) I am not here to financially support governments to extort people. The more we pay, the stronger they become.

It's not all that difficult, but in most cases people think that just because governments don't explicitly refer to crypto, or that it isn't legal yet, they don't have to pay tax, which is completely wrong. Some even think that due to crypto's 'anonymity' they can freely do everything they want without paying tax.

Is there a Dutch thread on this subject? Because I read a little bit on the dutch tax system, from what I understand, it's pretty relaxed  ;D

Very actual issue! But with the launching of regulation, tax evasion will become more and more difficult. How to cash out the profit? After all, the banks are at the same time with the tax authorities!

It depends upon the laws of your country. For crypto tax is available in your country then it is good to pay tax.  If you earn money but your are not ready to pay tax means it is scam and you have to face lot problems. I thinkmost of the countries are not announced tax for crypto currencies.  So check with your country rules and regulations and act according to that.

you may check local boards :)
good for you if your tax system is a bit relax on crypto profits, most 1st world countries have a serious law on taxation when it comes to crypto market because they notice a large number of people getting a good wealth in the past years.

The Dutch system is kinda crazy (but in a good way for us). If you're doing taxes (Netherlands only) then you need to add it under the 'Capital section' but the 'best' (insane in the crypto world) part is that they are only interested in the value of the crypto as of January the 1st of that tax year, which can lead to some pretty funny/crazy situations. You can read more here (http://www.dutchcryptoconsultancy.nl/cryptocurrencies-dutch-law/).

That said, I have heard whispers that they are going to change and adapt this in the near future, but whether that happens or not is something these.

Paying taxes on income from ceyptocurrencies means cryptos are legal and government accepts  cryptos as legal tender and  Governments  have established rules and guidelines about cryptos and therefore you are secured to invest. So i don't think  one should avoid paying  taxes on cryptos.

If Bitcoin is legal in your country then it is impossible for you to avoid paying Bitcoin tax because of regulation in which the tax will be collected in your local exchanges that every time you convert your Bitcoin to your local paper money it will be subject for Bitcoin tax which is really unavoidable because every local exchanges are oblige to submit every Bitcoin transaction as per regulation policy. Except if Bitcoin is not legal and not ban like in our country then for sure you will going to enjoy earning Bitcoin without tax.

In the legislation of Great Britain, a loophole was discovered that allows crypto-investors to classify crypto-currency profits as "income from gambling". Having declared their income as a "gambling winnings", the British can not pay any taxes.

I suppose the government will not push micro earners to pay taxes from crypto profit. So if you are one of them you have nothing to worry about. I do not see anything bad in taxation of crypto profit, if my government will make it necessary I will pay, what else to do?!

Why you try to avoid crypto tax? If you accept the crypto tax for the government, then it is likely that the government will have positive thoughts about bitcoin and cryptocurrency. If the government wants people to pay the crypto tax, then I will certainly pay taxes

You can buy cryptocurrency as a resident of Puerto Rico

If you’re not old enough to have a large retirement account, and don’t want to lock up a couple million dollars in a life insurance policy, then consider moving to the US territory of Puerto Rico.  The Caribbean island of Puerto Rico has a tax deal you can’t refuse!

We US citizens are taxed on our worldwide income. No matter where we live, we must pay US tax on our capital gains, including gains from cryptocurrency. The only exception to this rule is found in the US territory of Puerto Rico.

Why go to Puerto Rico yourself? It is enough to have someone familiar there and work through his account. There are also many other countries in which the government is not interested in cryptocurrencies at all. You need to have a lot of friends around the world and then the problem of taxes you will not.

i am new on crypto. doing work,how to avoid tax on coins when i got coins?

It depends on your governments law. Most country have not yet legalize bitcoin, therefore, they do not have the power yet to collect taxes on it when you do transactions on bitcoin. Once a government legalizes or regularizes the use of bitcoin, then the government can impose tax on it, when this happens it is better to pay the taxes you are required to pay rather than avoid it to prevent sanctions.

And which countries will have 0 tax on cryptocurrency? I know Germany has, but you need to hold crypto for at least year to be able to avoid taxes.

There are legitimate ways to minimise your tax liability and there is tax evasion, sometimes the boundaries between the two are unclear. How you minimise your taxes depends very much on your country of residence as each country has it's own regulations. Remember tax evasion is illegal and could land you in jail.

As you are not trading in a physical product, the situation is even more complex. Additionally the way you structure your trading will depend on the amount of the trades and the volume  of trades-it would be pointless setting up an expensive, complex but legal structure to minimise your tax if you are only making a few hundred or even couple of thousand dollars per year, as the cost will wipe out your profit.

Realistically-you need to allow $2500-5000+ to set up the structure and $1500+ per year to maintain (excluding any accountants and legal advise).

Think carefully, take sound advise from your accountant and legal adviser before getting in to deep, it could cost a whole lot more if you get it wrong and don.t seek professional advise.

that is right, we need to obey the government rules and I am sure that we are safe and we don't have to break any law in our country. it is better to pay the tax for cryptocurrency then to go jail because we don't pay the tax. besides that, we can free to use cryptocurrency and we don't have to worry about anything because we are following the government suggestion and we can show to other people that we are still paying the tax.

Anyone interested in how to avoid tax on crypto:

I summed up the best solution I could find here:

https://bitcointalk.org/index.php?topic=5080391.0

we should use bitcoin for something that is good and does not violate the law, so this makes bitcoin more known, because with a good image all the facilities of bitcoin can be utilized by all levels of society, about bitcoin tax will not be a significant problem, because all products in this world will definitely be taxed, this is what makes the product legal, the tax applied I think is comparable to the benefits we can get.

You could move to Puerto Rico hehe

Embrace taxes. Tax is part of our everyday lives for as we live in a community that needs it. It funds almost everything you see on the streets. But sure, there is a way to minimize tax but to actually waive it!

no its not . we are already been charge by a high transaction fees and other servicing fee from trading platforms  .


thats not illegal because that all are normal not only in crypto but also on any other business as well  . those acts are the ones that gives us an oppurtunity to buy low and sell high because they help the price to become more unstable  .

The very best way to save money from taxes in crypto?live in areas whereas theres no regulation in taxing the coins,and preferably you can find this in some asian countries where the governments are neutral on crypto and may not putting tax

You’re gaining money and wanted to avoid paying taxes?you are a greed person mate and thats not a good attitude,remember that paying taxes is an obligation and regulated

And besides gaining in crypto is too easy than working hard in jobs,so why paying tax in regular job and not in this area of profiteering?please stop acting like tax evaders because that’s punishable by laws

if you produce why you avoid taxes generated from Crypto and you only pay partially, not all of your money lost to pay. working on Crypto is easier than real work, yes indeed because working on Crypto can be done anywhere and anytime that allows us to share time for other jobs, and your chances will be greater.

Maybe in one day when all country uses crypto, we will see a tax for every crypto user, and we should pay the tax in the exchanges and for sending the money from bitcoin into our bank account. But now, I don't have to pay the tax for convert my bitcoin into local fiat because when I got a fiat and sent to my bank account, I use a third party and I only pay his services because he helps me to send the money into my bank account.

If your government says that you need to pay taxes on your cryptocurrency profits then you need to do it. You are going to be in conflict with the law one day I tell you that. Just look at the past scammy ICOs that is now getting summoned or subpoena by the SEC. Your transactions on the blockchain is going to be the strong evidence so think again.

Tax is a need that must be obtained from a transaction carried out in a country. Therefore, transactions using bitcoin must also be taxed. But the problem is that all transactions occur in cyberspace, so the government cannot control it.
Therefore, the government must be aware of the final transaction, namely withdrawal of cash money on the exchange of bitcoin because that is the only chance the government can withdraw taxes.

Yeah sure tax is needed and important because is the only way to improve the state of the country.


Transaction of bitcoins does not occur in a cyberspace but they only occur online under the blockchain system/technology . you can still pay your own tax if your government cant tax you because they cant hold bitcoin  .


Some exchange are centralized , i think governments can carry out a tax on them  . there are also local exchange available for crypto to fiat withdrawals , this might also be possible for governments to charge them/us by a tax  .

Using crypto money in order to avoid taxes is the thought of many people, because they assume taxes have taken away from their profits.
Though for the progress of a country must have income, one of them from taxes, so that avoiding taxes in my opinion is not wise. But transactions using crypto money while still in cyberspace are not taxed, because they are not monitored by the government.