Spain is approaching the last day its citizens can file their tax returns, and this year, cryptocurrency traders are targeted by tax authorities. Any trader who has made income after selling cryptocurrencies is required to file taxes and pay a percentage of the operation. However, many new traders are still unsure of what to do.
Spain’s tax authority is preparing for crypto traders
Spain is approaching the deadline for filing tax returns. This year the tax authorities are special focused on cryptocurrency traders due to the tremendous growth in the industry. According to local reports, 7.5 million Spanish citizens have entered the world of cryptocurrencies. In addition, around 60% of them use it as an investment vehicle.
Under Spanish law, any trade or cryptocurrency sale that has been registered with revenue should be declared. Spanish citizens who fail to submit their declarations can face fines. While tax levies on cryptocurrencies weren’t important to tax authorities before, this year will be different. The Spanish government is stepping up oversight and the tax authority has announced a plan to minimize crypto-related tax evasion this year.
The tax office is now need Trade data from Spanish stock exchanges to systematically target traders who fail to file their taxes. The Spanish government is also amending an anti-fraud law to force third-party custodians to provide data about their customers. While this change is still in the works, it shows the government’s stance for the near future.
The deadline for filing taxes is the next June 30th and late declarations will incur a penalty fee.
General inexperience and lack of tools
Despite improved oversight and awareness campaigns, most Spanish traders still don’t know what to do when it comes to filing tax returns. Many are new to these environments and are outside the domain of tax laws and the like. This can potentially create a scenario where most crypto traders would have to pay tax penalties in the future.
And many who are aware of these tax obligations do not have the tools to report them. The average trader performs hundreds of operations in a month. Most merchants do not archive or order these operations for a tax report. However, there is software that can assist traders on this journey. Accountants advise traders to use these software tools to make this complicated job easier. However, experts estimate that most trades out of ignorance do not explain crypto taxes.
What do you think of Spain’s stance on cryptocurrency taxation? Let us know in the comments section below.
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