📝 Description
Since the 2023 State Budget, Portugal has ended its status as an "absolute tax haven" for cryptocurrencies by introducing a precise legal framework. However, it remains one of the most attractive countries in Europe thanks to a major exemption based on the holding period.
This guide explains the basics of Portuguese legislation (IRS) for individuals and the steps to follow on Waltio to obtain a tax report perfectly suited to your situation.
💡 Crypto Tax Essentials in Portugal
Category | Tax Rule |
Global Tax Rate | 28% (Flat tax on capital gains) |
Holding Exemption | 0% tax if crypto is held for more than 365 days |
Crypto-to-Crypto Exchanges | Non-taxable (Tax deferral) |
Capital Gains Calculation | FIFO method (First-In, First-Out) |
Filing Deadline | Between April 1st and June 30th of the following year |
💰 Calculation and Tax Rates
In Portugal, gains from the sale of cryptocurrencies are considered movable capital gains.
Standard Rate: If you sell your cryptocurrencies less than a year after buying them, the net capital gain (Selling Price - Purchase Price) is taxed at a flat rate of 28%.
Tax-Free after 1 year: This is Portugal's great advantage. Any cryptocurrency held for more than 365 consecutive days is totally tax-exempt (0%) when resold for euros.
The Portuguese tax administration requires the use of the FIFO method to determine which tokens are sold first, and thus accurately calculate their holding period and your capital gain.
🔄 Crypto-to-Crypto Operations (Trading)
Portuguese law is extremely favorable to traders: exchanging one cryptocurrency for another (for example, selling Bitcoin to buy USDT) is totally tax-exempt.
Better yet: the holding period is cumulative! If you hold BTC for 6 months, exchange it for ETH, and keep that ETH for 7 months before selling it for euros, the total period recognized by the tax authorities is 13 months. The final sale will therefore be exempt at 0%.
⚙️ How to set up these operations on Waltio?
To ensure comprehensive tracking of your transactions, Waltio considers all exchange operations as taxable by default.
Your process: To ensure your report reflects the exemption (tax deferral) provided by Portuguese law, you must go to your Waltio space and manually change the status of each Crypto-to-Crypto exchange operation to "Non-taxable". This way, the software will not calculate any capital gains on these intermediate trades and will correctly carry over your acquisition price.
🎁 Passive Income (Staking, Mining, Airdrops)
In Portugal, passive income paid in cryptocurrencies (such as staking or airdrops) also benefits from favorable treatment: the tax authorities defer taxation. They are not taxed at the time of receipt, but only upon their final sale into fiat currency.
⚙️ How are they managed on Waltio?
Great news: Waltio's methodology is aligned here with the philosophy of Portuguese law:
Passive income is marked as non-taxable upon receipt.
The software assigns them an acquisition value of €0.
Practical consequence: Taxation is deferred. It is only when you decide to sell these tokens (from staking or airdrop) for a currency like the euro that the operation will be calculated. Since the acquisition price is €0, the entire disposal amount will be considered a capital gain (which will be taxed at 28% if held for less than a year, or 0% if held for more than a year).
Do you wish to report upon receipt?
Although Portuguese law defers taxation for gains paid in crypto, if you carry out a professional activity or if you wish, for accounting reasons, to record this income immediately in the year of receipt, a manual step is required on Waltio. You will need to individually modify each passive gain transaction to enter its acquisition price (the market price of the token on the exact day of receipt). Thus, the acquisition value will no longer be €0, and the operation will be recorded as immediate income.
✅ What triggers tax (Crypto ➔ Fiat)
The major tax event in Portugal is the return to the traditional economy:
Sale for currency: Converting your cryptos into Euros (EUR), Dollars (USD), etc.
Purchase of a good or service: Using your cryptocurrencies to pay for a purchase.
As soon as Waltio detects an exit to a Fiat currency, the software automatically calculates the corresponding capital gain using the FIFO method. It is then up to you to break down these sales according to their holding period on your tax return.
📝 Filing: Calendar and Annexes
Even if your gains are exempt (0%), reporting remains mandatory if you have made sales.
Tax Period: From January 1st to December 31st (Calendar year).
Required Forms: - Annex G (Anexo G) to declare sales of cryptos held for less than 365 days (taxed at 28%).
Annex G1 (Anexo G1) to declare sales of cryptos held for more than 365 days (exempt).
Filing Deadline: The IRS declaration must be made online via the Portal das Finanças between April 1st and June 30th of the following year.
Disclaimer: This guide is provided for purely informational and educational purposes. Legislation surrounding digital assets is sometimes subject to interpretation and can evolve. Waltio does not provide tax or legal advice. We strongly recommend consulting a tax lawyer or a certified professional in Portugal to validate your personal situation, particularly for the application of the 365-day exemption.