Bitcoin Forum

Any suggestions on how one may avoid tax or minimise tax on crypto currencies?

Avoiding tax? This can't be done anymore in US, where do you live?

Read these http://www.escapeartist.com/blog/4-ways-pay-zero-tax-cryptocurrency-gains/

 https://www.reddit.com/r/Bitcoin/comments/6cz0ac/how_to_avoid_capital_gains_tax/

I will be based on where you living,in my country there is no specific taxes for using crypto currency usage so we have to pay taxes according to our income monthly or annually.So in that case we can try to use bank accounts of different persons while trading so the taxes will be less.Because every govenrment has some minimum limit per month to pay taxes.

*But I don't know it will be applicable or not for you!

It really depends on your jurisdiction. But the smart thing to do would be to give to Caesar what belongs to Caesar,  and pay your share. Make sure to keep a decent ledger,  and to study the tax system in your jurisdiction.
  Investopedia is the my favorite source for financial information, as they provided a wealth of free information to the financial newbie. Here is a link regarding U.S tax compliancy for crypro coins.

https://www.investopedia.com/university/definitive-bitcoin-tax-guide-dont-let-irs-snow-you/ (https://www.investopedia.com/university/definitive-bitcoin-tax-guide-dont-let-irs-snow-you/)

    Taxes can be discouraging,  be don't fret my friend, just take the time to study the laws, and use them to your benefit! Everyday should be a new learning experience when dealing with cryptographic currencies.

If you plan on doing such a thing, the smart thing to do would be to consult a tax lawyer or an accountant. You could go to jail if you mess this up, and unless the answers you get here are from people engaged in the aforementioned professions and are based in your country, you should ignore them.

Either way, things like tax avoidance require exploiting existing loopholes, and that may not be worth the trouble unless you're a whale or close to it. Personally, I'd rather just face the music and pay the right taxes.

You have to think about tax globally.
Income from trading cryptocurrencies is only one part of your income, so you must think about how to reduce your whole income tax.

And when it comes to capital gains, you shall learn that there are some countries where there aren't taxed at all.

I know the popular wisdom is that you can't escape taxes in the US, but ultimately it depends on how motivated you really are.

For example, if you relocate to Puerto Rico, any capital gains you generate on assets acquired after relocating are tax free for the next 20 years or so.

Not super useful after the fact, but this is just one loophole among many.

If you're playing with large amounts, this is the kind of things of good tax professional would be able to help you with.

It may not work in all countries but:

- In some countries, donations are not taxed. So donate the money to your brother (0% tax)
  then your brother donate to your sister (0% tax) and finally, your sister donate to you (0% tax)  :D

- Buy gold with cryptos, once you receive the gold bars, sell them

- Use decentralized exchanges

- Move to a country without taxes on capital gains for 6 months

- Pay the taxes in your country, because it is somewhat for your own benefits too.

This would be entirely depending on how your country or place do impose taxation laws.If they are strict on implementing this then its better not to avoid and follow their regulations if you dont like to suffer problems ahead. If they would able to trace you out on your earnings on cryptocurrencies they better not to insist but rather pay up on what they required but i do believe this is only can be seen on some countries which are strict when it comes to cryptocurrencies but most of the time countries arent put too much focus on this one.

This is somewhat good idea but unfortunately it won't work and based on the Capital Gains Tax Act that I have sighted I have not seen such loophole and I don't think drafters of laws, the legislative house that will pass it or the Executive that will append signature can allow such to pass all over the world. What the law says from here is something acquired by way of gift and disposed as gift so if anything is go by your analogy, its just shifting the eveul day forward because at some point you will have to either use it buy something, or convert it to fiat which in from the tax point of view, is sale and tax becomes payable.

A way I can think of is if the capital gains tax is high in your own country, convert it abroad, then issue an invoice for services to be paid in form of consultancy fee the tax rate for consultant is always lower than Capital Gains Tax with that you reduce your tax liability and if you have paid tax in the country its coming from, you enjoy double taxation relief.

If you are residing in the United States, I don't think that it can be done legally. If you want to do it through illegal means, there are dozens of methods. For example, you can purchase bullion in exchange of Bitcoin from the dark markets, or use pre-paid Bitcoin debit cards to withdraw fiat cash from the ATMs.

It maybe hard in other places, but in my place, someone just made his own business In real life then he uses that as his way to recognize where his profit is coming from. Off course he cant withdraw instant high amounts and he just cashout low amounts each time. But now cashing out more than 500$ is questionable that the server wants to vefiry who is using the money by making a real time video of your self for your money to be confirmed 1st.

Avoiding tax in that sense wouldn't be a good idea. Every country have its own set of rules when it comes to paying taxes, be knowledgeable of how tax works in your country and it would be better if you pay it honestly.