How do you have to pay taxes on cryptocurrencies in the Slovak Republic? (overview)

Many praised, by many damned, referred to as the “gold” of the future, but also an unnecessary investment. Cryptocurrencies, led by bitcoin, have been with us for some time and have maintained popularity among their community for many years, but the company has gained a lot of attention especially in recent months, when they literally “beat” previous records and their value increases exponentially almost every week. .

The ever-growing popularity of bitcoin and other cryptocurrencies is likely he also noticed among the Slovaks, which began to buy cryptocurrencies especially from the end of autumn, when their price began to rise the most. Since then, of course, we have seen some downturns, but the price of bitcoin is now rising.

There are an enormous number of ways to buy cryptocurrencies, and Slovaks, in addition to “classic” brokerage applications, also resort to dedicated cryptocurrencies, where they store virtual currencies.

However, most of our compatriots tend to trade, and thus buy and later sell cryptocurrency, when its price increases. However, if you thought that such income is exempt from taxes and levies in Slovakia, this article will mislead you.

We will focus on tax liability in the trade of cryptomes for natural persons, which includes a number of Slovaks who trade in cryptomes “on their own”.

The legislation covers most cases sufficiently, but you pay extra for taxes

On October 1, 2018, when, by the way, the price of bitcoin was at the level of $ 4,500, the methodological guideline entered into force. MF SR č.MF/10386/2018-721 to the procedure for taxing virtual currencies.

This regulates the income (income) arising from the sale of virtual currency as a subject of tax, which is not exempt from tax and is therefore considered taxable income under Act 595/2003 Coll. On income tax.

“Virtual currency means a digital bearer of value that is not issued or guaranteed by a central bank or a public authority, nor is it necessarily linked to legal tender, has no legal status of currency or money, but is accepted by certain natural or legal persons as a means of payment; and which can be transferred, stored or traded electronically, ”is the definition of cryptocurrencies in the law.

The sale of a virtual currency is then considered to be any exchange, for example an exchange of a virtual currency for an asset or a monetary value, an exchange of a virtual currency for the provision of a service or its transfer for consideration, including an exchange for another virtual currency.

So you always pay taxes when you sell a cryptocurrency or buy property or another cryptocurrency for it.

How do you know how to reduce your tax base?