Do cryptocurrencies have to be taxed?

Bitcoin has cracked the $50,000 mark and other cryptocurrencies have also significantly gained in value. Many individuals have seized this opportunity to enter into cryptocurrency trading and to acquire coins themselves. With the upcoming tax declaration, the question arises whether balances in cryptocurrencies and any potential capital gains must be taxed.

Did you invest in cryptocurrencies in the past year? Or did you even manage to sell your coins profitably? If you answer yes to these questions, then you should find out whether your cryptocurrency balances and capital gains need to be taxed.

Taxing Cryptocurrencies

Whether cryptocurrencies need to be taxed depends significantly on the nature of the cryptocurrency or a coin. Detailed information about the taxation of cryptocurrencies can be found on the website of the Federal Tax Administration. The following principles can be recognized for regular cryptocurrency trading:

Wealth Tax

Portfolios containing cryptocurrencies (wallets) are considered assessable, tradable items that are legally equivalent to moveable capital assets. Crypto wallets are thus intangible assets which are subject to wealth tax. Anyone who owns cryptocurrencies must list them in the securities and credit ledger of their tax declaration. Relevant is the market value of the cryptocurrencies, which typically corresponds to the price at which a coin is traded. If no current price can be determined, the original purchase price converted into Swiss Francs is used.

Income Tax

Capital gains on cryptocurrencies are generally tax-free, as they are considered "tax-free private capital gains". Thus, those who buy cryptocurrencies from their private assets do not have to pay income tax on these. Conversely, capital losses are also not deductible.

Taxable, however, are cryptocurrencies that were acquired through mining. The provision of computing power in exchange for a fee (coins) is tax-legally classified as independent economic activity. Cryptocurrencies obtained in this way are therefore subject to income tax.

Caution is also advised during regular trading of cryptocurrencies. Anyone who trades cryptocurrencies on a commercial basis must tax the profits realized as independent earned income. If you regularly buy and sell coins, you should therefore inform yourself about the difference between pure asset management and independent secondary income.

Important for sole proprietors: For cryptocurrencies that belong to business assets, the tax regulations regarding independent economic activity apply.

Did you know? The Federal Tax Administration publishes a price list with the tax values of the most important cryptocurrencies.

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