To the cryptocurrencies They came with everything in the lives of many financial investors, but they ask for care in the management of assets. Therefore, The Federal Government supervision is watching and do you know how to declare digital currencies on your income tax this year?
O Bitcoin, The Ethereum and the NFT These are some virtual currencies that are part of the daily lives of investors in many countries. Cryptoactives form a new financial asset, which is why the tax authorities turned on the radar on new investments.
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However, the Federal Revenue said that investments with digital currencies are declared in income tax. Therefore, you must stay tuned and be careful not to forget to inform your investments with currencies.
How to declare cryptocurrencies?
Digital currencies are not regulated in Brazil and, therefore, have no rules for trading. Nonetheless, they represent a financial source for the investor and need to be listed in the category of assets and rights in income tax.
In 2019, cryptoassets gained their own section and code in the annual IR declaration. Previously, these digital assets were included in the “Other assets and rights” form, they must now be declared as the personal property of a financial investor.
If you have any taxes to pay on your income tax return, the investor must issue the Federal Tax Collection Document (DARF). However, payment must be monthly, whenever investments total more than R$ 35 thousand.
When should I declare digital currencies?
The declaration of cryptoassets is the same as the declarations of assets such as real estate and financial investments. You need to declare when you buy the coins, however, if an investor wants to sell the assets they must calculate the tax based on capital gains.
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However, if the investment had a balance of R$ 5 thousand in 2021, the cryptocurrencies must be included in the declaration. If you have a portfolio below this value, don't worry about declaring your investment in digital currencies.
However, the RF presented some differences when declaring investments with assets. Then, If a person has a portfolio of 5 thousand reais in Bitcoins and another of 3 thousand reais with Ethereum, you just need to declare the one with the highest value.
What are the codes for cryptocurrencies?
This year, the Federal Revenue changed the asset codes in the income tax declaration. In the “Goods and rights” section, the investor must mark group 8 to inform cryptocurrencies and choose the following codes:
- Code 1 for Bitcoin;
- Number 2 for other currencies like Ethereum, Ripple, It is Bitcoin Cash;
- Code 3: Stablecoins as Tether, USD Coin, Brazilian Digital Token, Binance, DAI, True USD, Gemini USD, Paxos USD, Paxos Gold;
- 10: cryptoassets known as NFT;
- Code 99 for other investments such as non-cryptocurrency tokens.
How to report movements?
The tax is charged when transactions exceed R$ 35 thousand in the purchase and sale of cryptocurrencies. Therefore, If you negotiate values below this limit you will not need to pay anything, but if you exceed this value you must report to the Revenue.
Still, the investor must fill out another declaration at the Federal Revenue Virtual Service Center (E-CAC), whenever they make new transactions above R$ 30 thousand. But, only if you trade with brokers abroad or if you don't use these platforms.
In addition to paying income tax, the taxpayer must report capital gains from cryptocurrencies in the Capital Gains Program (GCAP) in site of the Federal Revenue Service. Thus, the information will be used for future statements.
Therefore, Pay attention to your 2022 income tax declaration, which must be submitted by May 31st. Therefore, seek help from accountants or search for information on correctly filling out investment information.
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