ANCEI | CRYPTOCURRENCY TAXATION IN ANDORRA
The phenomenon of cryptos, together with the rise in the capitalization of Bitcoin and other cryptocurrencies, forces governments and central banks around the world to “improvise”, since they have not yet managed to formulate a common strategy that allows them address those assets. Therefore, in general, the situation is quite ambiguous everywhere: Cryptocurrency regularization is a work in progress for legislative bodies around the world. And, for that reason, there are many crypto investors who must deal with the laws in force in their respective countries, since capital gains are usually subject to tax, in most countries.
CRYPTOCURRENCY AND THE SPANISH TAX AUTHORITIES
Faced with this situation, the European Commission has proposed the creation of a central database that collects information on Bitcoin users, their identities and wallets. While Spain, on the other hand, and as recently reported by its tax agency, plans to launch investigations to address “the threat of cryptocurrencies.”
It’s important to Know that unless you live in a country where gains from holding or exchanging cryptocurrencies are not taxed at all, you will have to record your cryptocurrencies, as well as find out how to pay taxes for them correctly, before the next tax season. Therefore, if you own bitcoins or any other cryptoactive, you should know the regulation that cryptocurrencies must be subject to in your country, since, probably, you should be paying taxes on your accumulated income or you could be falling into a crime of tax evasion, among others. In Spain, for example, the sale of cryptocurrencies can be understood as the sale of currencies or stocks. Therefore, if you are spanish , and subject your (capital) gains to such taxation, you will be paying considerably more than anyone else in the world.
As holding cryptocurrencies can be assimilated to currencies or stocks, you can consequently take them with you if you change residence, taxed on said gain, for tax purposes, where you end up effectively residing.
Are cryptocurrencies subject to the exit tax?
CRYPTOCURRENCY AT 0% IN ANDORRA
Beyond the literature, for or against cryptocurrencies, the truth is that, more and more people decide to “test” this type of asset, hoping to obtain with them a higher performance than the “traditional” financial markets. In fact, cryptocurrencies, with Bitcoin in the lead, are making headlines for the high revaluations that most of them have experienced in recent weeks, reaching all-time highs. And those who have invested are wondering: and, now, how should I pay?
Currently, there are few countries in which the taxation of cryptocurrencies is 0%. These countries, normally, bet on fiscal policies that prioritize the attraction of large assets, with the objective that these “convert” part of their investments to fiat money and, with this, contribute to generating wealth in the country, through the consumption of high-value services (private medicine, schools, universities, etc.), the purchase of assets (real estate, vehicles, etc.) or the creation of companies that create new jobs, rent offices, hire professional and banking services, etc. Therefore, these countries try to increase state revenue through indirect taxes, thereby not limiting the fiscal control of these profiles. What role does Andorra play in this context?
As we mentioned previously, Andorra already has a favorable tax treatment for crypto investors, among others, since there is no Patrimonial Tax and that, at the personal income tax level, capital gains are taxed at a maximum of 10%. However, the Andorran government has raised the possibility of reviewing the law and is going to study how cryptocurrencies could be exempted from taxation. As a country in transformation towards an economy that is committed to innovation tech, where it is legislated in favor of digital assets, we can say that in Andorra cryptos could be taxed at 0%.
At ANCEI Consultoría Estratégica Internacional we help you change your tax and effective residence, so that you can arrive in Andorra complying with all the relevant obligations.
INCOME AND CORPORATE TAX ARE A MAXIMUM OF 10%
THERE IS NO PROPERTY TAX
NO SUCCESSION NOR DONATION TAX
THE IGI (LIKE VAT OR VAT) IS 4.5%
YOU WILL NOT HAVE TO SUBMIT THE FORM 720
YOU WILL NOT PAY EXIT TAX FOR YOUR CRYPTOS
YOU WILL BE TAXED A MAXIMUM OF10%
CRYPTOS COULD GET TAXED AT 0%
WE WILL HELP YOU WITH YOUR CHANGE OF RESIDENCY
- Responsible for the treatment: ANCEI Consultoría Estratégica Internacional, SA
- Purpose: Manage the user’s request.
- Legal basis: The consent of the user.
- Recipients: Your data will not be transferred.
- Conservation: Maximum legal period established.
- Rights of the interested party: Access, rectify and cancel the data referring to your person, oppose the processing of the data, request the limitation of the treatment or the portability of the data.