Spanish authorities are taking a tough stance on the cryptocurrency sector, and the national tax authority seems to be taking it very seriously. Hacienda has now issued 14,800 warnings to Spaniards under its supervision for allegedly failing to report cryptocurrencies.
Penalties can exceed $5,900 if the cryptocurrency holder fails to file the required tax returns.
According to Telemadrid, the Spanish tax authorities have said that cryptographers will be taxed, and reminders have already been sent to their correspondents.
Spanish cryptocurrency owners must declare their income in their tax returns, and if they don’t, they risk fines of more than 5,000 euros ($5,900), Acienda said.
However, Hacienda clarified that domestic cryptocurrency owners are not responsible for their cryptocurrency purchase transactions, but only for profitable sales. According to experts quoted by local media, the Spaniards will have to declare on this occasion that they will sell profitably in 2020:
Either because we exchanged them for euros in another cryptocurrency, or because we used them to buy a nice, apartment or a car.
This means that if someone bought 10 bitcoins (BTC) worth €10,000 ($11,880) in 2017 that sold for €200,000 ($237,700) in 2020, the cryptocurrency owner should declare a capital gain of €190,000 ($225,800), experts said.
IRS registered 66,000 crypto currency holders in 2020
But the number of letters Hacienda sent this time is much smaller than in 2020. Last year, the Spanish tax authorities ran a similar campaign to send cryptocurrency owners notifications, but it reached 66,000 cryptocurrency owners.
That number is a significant increase from the 14,700 tax letters the agency sent to cryptocurrency holders in 2019.
As reported by Bitcoin.com News in February 2021, Ana de la Cueva, Spanish Secretary of State for the Economy, said that cryptocurrencies such as bitcoin carry a risk of default because the user does not have the protection that traditional payment systems provide against default by a counterparty.
In the same month, the Spanish National Tax Administration issued guidelines to combat tax evasion with cryptocurrencies.
What do you think about the fact that the Spanish tax authorities have sent tax letters to 14,800 secret holders? Let us know your comments in the section below.
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