TL;DR: Cryptocurrency is taxable in all 7 countries covered by MmowW Scrib🐮. Whether you receive crypto as payment, trade it, mine it, or hold it as a treasury asset, each transaction may trigger a taxable event. Tax rules are evolving rapidly — this guide maps the current state as of 2025/2026 and highlights record-keeping requirements every business must meet.
MmowW Scrib🐮 is a document preparation service, not a law firm. We do not provide legal advice.
Cryptocurrency is no longer a niche concern. Businesses receive crypto as payment, hold Bitcoin on their balance sheets, pay contractors in stablecoins, and engage with DeFi protocols. Tax authorities in all major jurisdictions have issued guidance, and the consensus is clear: crypto is taxable, and "I didn't know" is not a defence.
This guide covers business taxation of cryptocurrency — not personal investment. If you hold crypto personally, consult a qualified accountant for your personal tax position.
Crypto is property, not currency (for tax purposes). Except where specifically designated as legal tender (El Salvador/CAR only), cryptocurrency is treated as an asset — not cash. This means:
Each transaction is taxable. Every time you convert crypto to fiat, exchange one crypto for another, or use crypto to pay a supplier, a taxable event occurs. High-frequency trading businesses can generate thousands of taxable events per year.
VAT/GST treatment is complex. Tax authorities differ on whether crypto transactions attract VAT or GST. In the EU (including France) and UK, crypto-to-crypto and crypto-to-fiat exchanges are generally VAT-exempt following the Hedqvist ruling. In Australia, GST applies unless an exemption applies. Rules continue to evolve.
Framework: HMRC's Cryptoassets Manual (December 2019, updated) is the authoritative guidance.
Income tax / Corporation tax: Crypto received as payment for goods or services is treated as income (trading income) at the GBP value on the date of receipt. The crypto asset is then held on balance sheet at that cost basis.
Capital gains: When crypto is disposed of, the gain or loss is calculated as proceeds minus the original cost (pooling rules apply — HMRC uses "Section 104 pool" averaging). Companies pay corporation tax on gains; individuals pay CGT.
Mining: Crypto mined in the course of a business is trading income on receipt. Mining as a business activity carries full tax obligations including national insurance.
DeFi: HMRC has issued specific guidance on DeFi lending and staking. Lending crypto may not trigger disposal (depending on whether title passes); rewards/interest are taxable income.
NFTs: Treated as cryptoassets — same rules apply. Sales generate capital gains or trading income depending on frequency.
Payroll in crypto: HMRC requires PAYE and National Insurance on crypto paid as salary, calculated at the GBP value on the payment date.
Reporting: Self Assessment (individuals); corporation tax return (companies). HMRC has data-sharing agreements with major crypto exchanges.
Source: gov.uk/government/collections/cryptoassets
Framework: Direction Générale des Finances Publiques (DGFiP) guidance, plus articles 150 VH bis and 92 B of the Code Général des Impôts.
Professional vs occasional trading: France distinguishes between occasional (non-habitual) crypto activity and professional trading. Businesses engaged in crypto trading professionally are taxed under BIC (Bénéfices Industriels et Commerciaux) rules.
Gains: Calculated as proceeds minus cost. EUR-denominated assets use FIFO or weighted average cost.
VAT: Following ECJ Hedqvist ruling, exchange of crypto for traditional currency is VAT-exempt.
Mining: Mining income treated as BIC if commercial in nature.
Reporting: Businesses must report crypto holdings and transactions. French residents and entities must declare foreign crypto accounts.
Corporate crypto holdings: Held at cost; impairment provisions possible if fair value falls.
Source: impots.gouv.fr — search "cryptomonnaies" for current guidance
Framework: Skatteverket (Swedish Tax Agency) has issued detailed guidance on crypto taxation.
Trading gains: Crypto-to-fiat and crypto-to-crypto exchanges are taxable. Sweden uses FIFO for cost basis.
Mining: Mining income is taxable income on receipt at market value in SEK.
VAT: Following Hedqvist (Swedish case), crypto-to-currency exchanges are VAT-exempt in Sweden. Mining may be outside the scope of VAT.
Corporate holdings: Crypto held as a financial instrument is marked to fair value. Gains/losses flow through the income statement and are taxable/deductible.
Reporting: Annual income declaration. Crypto-specific reporting box introduced. Banks report data under DAC8 / EU information exchange.
Source: skatteverket.se/kryptovalutor
Framework: Australian Taxation Office (ATO) has detailed guidance (last updated 2024).
Capital gains vs trading stock: If you hold crypto as trading stock (business inventory — e.g., a crypto exchange or trading business), it is taxed as ordinary income. If held as investment, CGT applies. The ATO distinguishes based on business intention and activity.
GST on crypto: Following amendments, crypto exchanges (disposing of crypto) are generally not subject to GST when used as payment. However, rules for crypto mining, DeFi, and NFTs are more nuanced. Consult the ATO's current guidance.
Mining: Mining as a business is assessable income at market value on receipt. Mining costs are deductible.
DeFi: ATO has released guidance — wrapping, liquidity provision, and staking may trigger CGT disposal events depending on the structure.
12-month discount: Individuals (not companies) get a 50% CGT discount for assets held >12 months. Companies do not get this discount — all gains taxed at full corporate rate (25% for base rate entities; 30% otherwise).
Record keeping: ATO requires records of all transactions in AUD equivalent, held for 5 years.
Source: ato.gov.au/individuals-and-families/investments-and-assets/crypto-asset-investments
Framework: Inland Revenue (IRD) has issued guidance (Revenue Alert RA 23/01 and related items).
Trading income: New Zealand taxes crypto as income when sold if acquired for the purpose of disposal (intent test). This is broader than capital gains taxation — if you bought crypto intending to sell it, the gain is income, not capital. New Zealand has no separate CGT for most assets.
Mining: Mining income is assessable income on receipt.
Payment in crypto: If you receive crypto as payment, it is income at NZD market value.
DeFi / staking: IRD has been developing guidance. Staking rewards are generally income when received.
GST: Crypto is generally treated as a financial service for GST purposes — exempt. Mining may be taxable supply if conducted as a taxable activity.
Source: ird.govt.nz/cryptoassets
Framework: Canada Revenue Agency (CRA) guidance, plus Income Tax Act provisions.
Business income vs capital: CRA distinguishes between crypto held as business income (frequent trading, mining, active market-making) and capital (long-term investment). Business income is fully taxable; capital gains include only 50% in income (increasing to 2/3 for gains above CAD 250,000 from June 2024).
Mining: Mining for business purposes is business income on receipt. Mining equipment may qualify for CCA.
Barter transactions: Exchanging crypto for goods/services is treated as barter — both parties recognise income/loss.
DeFi: CRA has limited specific guidance — treat cautiously; professional advice recommended.
GST/HST: CRA treats crypto as a commodity for GST/HST. Sales of goods/services paid in crypto attract GST/HST at fair market value.
Reporting: T2 corporate return. CRA has information-sharing agreements with exchanges.
Framework: IRS Notice 2014-21, Revenue Ruling 2019-24, and subsequent FAQs. Crypto treated as property.
Ordinary income vs capital gain: Short-term gains (held ≤1 year) taxed as ordinary income (up to 37% federal). Long-term gains (held >1 year) taxed at preferential rates (0%, 15%, or 20%). For C-corps, all gains are ordinary income at the corporate rate.
Mining: Mining income is ordinary income at FMV when received. Mined crypto has a cost basis equal to the FMV at mining date. Subsequent sale generates capital gain/loss.
DeFi: IRS has proposed regulations (August 2023) expanding broker reporting to include DeFi. Staking rewards are taxable income — confirmed in Jarrett v. United States (6th Circuit, 2024).
Form 1099-DA: From 2025, US crypto brokers must issue Form 1099-DA to customers, significantly increasing IRS enforcement capability.
Wash sale rule: Does NOT currently apply to crypto (unlike stocks). This may change.
FinCEN reporting: Businesses with crypto holdings may have FBAR or Form 8938 obligations if crypto is held on foreign exchanges.
Source: irs.gov/businesses/small-businesses-self-employed/virtual-currencies
Use our free tool: Cost Calculator
Try it free →Every crypto transaction requires documentation:
| Record Required | Why |
|---|---|
| Date of transaction | Determines holding period, applicable tax year |
| Amount received/paid | Establishes cost basis and proceeds |
| Fair market value in local currency at time of transaction | Required for cost basis and income calculations |
| Counterparty details (where known) | May be required for reporting |
| Transaction ID / blockchain reference | Proof of transaction |
| Purpose of transaction | Business vs personal; income vs capital |
Software: Crypto tax software such as Koinly, CoinTracker, Accointing, and TokenTax can aggregate transaction data from exchanges via API and calculate gains/losses automatically. Using purpose-built software dramatically reduces the risk of error and audit exposure.
Assuming crypto received is not taxable until converted to fiat. Wrong in all 7 jurisdictions. Income arises on receipt, not on conversion.
Treating crypto-to-crypto trades as non-taxable. Wrong. Exchanging ETH for USDC is a disposal of ETH. A gain or loss arises on the ETH position.
Not keeping records. High-frequency trading can generate thousands of transactions. Without automated record-keeping, reconstructing historical transactions is expensive and often incomplete.
Using the wrong cost basis method. HMRC requires Section 104 pooling (weighted average). IRS allows FIFO, LIFO, or specific identification. ATO uses FIFO unless another method is elected. Using the wrong method leads to incorrect gain calculations.
Ignoring hard forks and airdrops. These create income events in most jurisdictions (USA, UK, Australia confirm this). Record them as income at FMV on date received.
The MmowW Cost Calculator helps you estimate the professional accounting costs of managing crypto tax compliance — which can be significant for active trading businesses.
The MmowW Filing Deadlines tool tracks key tax return deadlines across all 7 countries to ensure your crypto gains and income are reported on time.
Is there a de minimis threshold for crypto tax — small transactions I can ignore?
In most jurisdictions, no. The UK, Australia, Canada, and USA tax every disposal regardless of size. Some countries have practical reporting thresholds in their systems, but legally every gain is taxable. Using crypto tax software to track all transactions is the only reliable approach.
What if I lost money on crypto — can I deduct the loss?
Generally yes, subject to rules. Capital losses typically offset capital gains (USA, UK, Australia, Canada, Sweden). In the UK, capital losses can be carried forward indefinitely against future gains. In New Zealand, losses on crypto may be deductible as ordinary income (if the intent test is met). In France, crypto losses are ring-fenced — only offsettable against crypto gains, not other income.
Do I need to declare crypto I have not sold?
In most jurisdictions, holding crypto does not trigger a taxable event. However, some countries (France, Canada, USA via FBAR for foreign accounts) require disclosure of crypto holdings above certain thresholds regardless of whether any transactions occurred. Check your specific jurisdiction.
Is staking income taxed?
Yes in the UK, USA, and Australia. The IRS confirmed staking rewards are taxable income at FMV when received. HMRC treats staking rewards as miscellaneous income (for individuals) or trading income (if part of a business). ATO treats staking rewards as ordinary income. Consult a qualified accountant for the specific treatment in your situation.
Can I pay employees in crypto?
Yes, but payroll tax obligations still apply. In the UK, PAYE and National Insurance apply on the GBP value of crypto paid to employees on the payment date. In the USA, FICA and income tax withholding apply. The employer must track the FMV at each payment date and process payroll accordingly. The administrative burden is significant — consult a qualified accountant before implementing crypto payroll.
MmowW Scrib🐮 is a document preparation service, not a law firm. We do not provide legal advice.
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