Rules of settlement cryptocurrency in accordance with Polish law. Cryptocurrency are an invention that was largely ahead of legal regulations and for a long time was in the grey market. For many supporters of digital money it was a very comfortable situation. Many of them used cryptocurrency in order to avoid taxation. Unfortunately, criminals also used cryptocurrency, who saw its potential as a means of preventing its detection.
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How to tax returns on investment in cryptocurrency
A large number of problems arise here. Is the bitcoin sale a financial transaction? Are additional profits from owning cryptocurrency beneficial? How to determine the purchase price and the sale price? How to determine the source of taxation? What tax should be applied to cryptocurrency tax – PIT, VAT, capital gains tax? The rules of cryptocurrency settlement are more questions than answers.
Two interpretations of the Ministry of Finance have already appeared in this matter. The Income Tax Department has defined the first one. The VAT department, on the other hand, will take over the second one. We will now discuss them in detail in detail the rules of settlement of cryptocurrency in Poland.
Rules of settlement cryptocurrency – Answer of the Ministry of Finance on settlement cryptocurrency:
Income Taxes Department (response to PIT taxation):
As a rule, the Ministry distinguishes between two types of transactions. The first one is where “the operation of paid disposal is the subject of a legally effective agreement” . The second one “cannot be classified as property rights revenue”.
In the first case, the revenue from such sale is included in the source of income referred to in Article 10(1)(7) of the Personal Income Tax Act of 26 July 1991 (Journal of Laws of 2012, item 961, as amended), hereinafter referred to as the “PIT Act”, i.e. property rights.
In the second case, revenue from such sale is included in the source of revenue referred to in Article 10(1)(7) of the Act of 26 July 1991 on Personal Income Tax (Journal of Laws of 2012, item 961, as amended), hereinafter referred to as the “PIT Act”, i.e. property rights.
Rules of settlement of cryptocurrency – Goods and Services Tax Department (response concerning settlement of cryptocurrency in the scope of VAT taxation):
In the case of the department responsible for VAT taxation, we are dealing here with payments for virtual goods, the transaction is subject to VAT. Virtual goods are understood here as “virtual objects in games” or payments for Internet services made in cryptocurrency. In such a case, according to the rules of cryptocurrency settlement, such transactions should be subject to VAT.
Rules of cryptocurrency settlement – What’s new on the horizon?
Due to the high popularity of cryptocurrency we have also prepared two other articles on this subject. One of them deals with potential risks related to Bitcoin. The second one describes the new currency that facebook is working on. Facebook Libra is supposed to revolutionize the online payment market – read the whole article.