Cryptocurrencies are digital assets that allow exchanges and value storage without the need for traditional intermediaries. In Spain, although their use is digital, they have tax implications, as any gain, loss, or reward derived from them may be subject to Personal Income Tax (IRPF), Wealth Tax, or reporting obligations such as Form 721. This section answers the most common questions about how to declare and manage your cryptocurrencies.
Do I have to declare my cryptocurrencies to the Spanish Tax Agency (Hacienda)?
If you are a tax resident in Spain, you must declare your cryptocurrencies when performing operations such as sales, exchanges, or staking, as these generate capital gains or losses subject to IRPF.
Additionally, if you hold cryptocurrencies abroad and their value exceeds €50,000 on December 31, you must report them using Form 721, even if you haven’t made any operations during the year. On the other hand, holding cryptocurrencies in personal wallets within Spain without exceeding this limit does not create an additional declaration obligation.
What happens when I sell or convert cryptocurrencies?
The sale or conversion of cryptocurrencies generates a capital gain or loss, which must be declared in the IRPF. It is calculated as the difference between the acquisition price and the transfer price. It is important to note that converting between cryptocurrencies is also considered a reportable operation because, for tax purposes, it is treated as a swap, which generates a gain or loss.
Capital gains or losses are calculated using the euro value at the time of the transaction, i.e., when you sell, exchange, or redeem your cryptocurrencies. The original purchase price or any later estimated value is not used; the official or market exchange rate on the transaction date is always applied. This ensures that the IRPF declaration accurately reflects the real capital variation in euros.
What if I exchange one cryptocurrency for another?
This is considered a sale of the first and a purchase of the second. Therefore, it also generates a capital gain or loss that must be declared in the IRPF.
What if I receive rewards from staking or mining?
- Staking: Rewards are considered capital income and are taxable under IRPF.
- Mining: Cryptocurrencies obtained are treated as business income and must be included in IRPF or Corporate Tax if operated through a company. You must also register as self-employed if you are not already, and comply with the corresponding tax obligations throughout the year.
Can I deduct losses from cryptocurrency operations?
Yes. Losses can be offset against gains in the same year. If there are no gains, they can be offset up to the following four years.
Do I have to declare cryptocurrencies in the Wealth Tax?
Yes, they must be included along with other assets. This applies only if you exceed the exemption threshold in your Autonomous Community.
Do I have to submit Form 721 for cryptocurrencies held abroad?
Yes, if their value on December 31 exceeds €50,000 and they are held on a foreign exchange. It does not apply if you keep them in personal wallets or physical devices located in Spain.
Are there ways to optimize taxes on cryptocurrencies?
Yes. You can plan sales to offset gains and losses or structure staking/mining operations in a tax-efficient way. Professional advice is recommended.
What documents are necessary to review whether I have had gains and/or losses from my cryptocurrency operations?
Some exchanges provide an annual summary with all relevant information and even values ready to report in your tax return, such as Binance. The report usually includes a Capital Gains Summary section showing all relevant data for the year.
If your exchange does not provide such a summary, you will need to calculate the data yourself or hire an additional service like Xolo to do it. In this case, our experts will need all transactions carried out during the fiscal year, along with the purchase and sale prices of each cryptocurrency, to calculate potential capital gains and/or losses.