Holding cryptocurrencies is not illegal. Not declaring them when necessary, however, can be.
📌 1. Do I have to declare just for having purchased cryptocurrencies? No. If you simply buy and hold cryptocurrencies, you do not have to declare them in your Income Tax Declaration (IRPF) until you sell them or exchange them for another crypto, euros, or another asset. But you must keep in mind: If you use Binance or another foreign exchange and your wallet exceeds €50,000, you may be required to submit Model 721 (mandatory from 2024).
💰 2. When must I declare in the income tax return? You must declare when you obtain profits, for example: You sell cryptocurrencies for euros. You exchange one crypto for another (this also counts as a transaction with a gain or loss). You use cryptocurrencies to pay for goods or services. These transactions generate a capital gain or loss that you must reflect in your income tax return. 📊 Earnings are taxed according to the following IRPF brackets (2024): Up to €6,000 → 19% From €6,000 to €50,000 → 21% From €50,000 to €200,000 → 23% More than €200,000 → 27%-28%
📤 3. What models can the Tax Agency ask me for? Model 721 (new): To declare balances in foreign exchanges if the value exceeds €50,000 as of December 31. Penalties for not submitting it: from €5,000 for each undeclared item. Model 100: Your income tax return, where profits or losses from your cryptocurrency transactions must be included. (Coming soon) Model 104: Will include data on cryptocurrency transactions within Spain. It will be linked to what national exchanges report.
🔍 4. How does the Tax Agency know what I do with my crypto? Many platforms (like Binance, Coinbase, or Kraken) are starting to collaborate with the Tax Agency and other tax authorities. Additionally, money movements between your bank and an exchange leave a trace. The Tax Agency cross-references data with other declarations and can open inspections if it finds inconsistencies.
✅ 5. Basic tips if you operate with cryptocurrencies Keep a record of all your operations (purchase price, sale, dates, commissions). Use tools like Koinly, CoinTracking, or Accointing to help you calculate your taxes. If you trade frequently or have significant gains, consult a tax advisor specialized in crypto. Even if you haven't declared yet, prepare from now: the regulatory environment is advancing and taxation on cryptocurrencies will become increasingly stringent.